HMRC issues reminder about early December pay dates

In its latest employer bulletin, HMRC issued a reminder to employers that pay their employees earlier than usual in December. Employees who are in receipt of Universal Credit can be adversely affected if the correct reporting procedure is not followed, as the system for reporting income may include two payments for a single assessment period. As Universal Credit entitlement is assessed on an ongoing basis, this can reduce or even remove their entitlement altogether, causing hardship. Additionally, the reporting of zero earnings in the subsequent assessment period can mean that entitlement to the work allowance is lost in that period.

HMRC says that in order to avoid the issue, the employer should always use the regular contractual pay date in the full payment submission (FPS) - even if the pay date is earlier or later than usual. So, for December a business that usually pays employees on the last working day of the month should use 31 December on the FPS. Doing this will ensure the problem of double counting is avoided.