Every time employees are paid, the employer sends HMRC a Full Payment Submission (FPS). It is the main real-time report: HMRC uses it to update each employee’s tax record and to calculate what the employer owes. Mistakes flow straight into employees’ tax codes and the employer’s PAYE account.
The timing rule
The FPS must be sent on or before the payday, the date the employee is paid, not the end of the pay period. If payday falls on a weekend and pay goes out on the Friday, Friday is the date that counts.
Limited exceptions allow later reporting, such as payments made on the day that could not be predicted, or certain employers paying cash at irregular times. When an FPS is late, the software asks for a late reporting reason; using one that does not apply does not prevent penalties.
Pre-submission checklist
Employees
- New starters have name, date of birth, gender, address and, where known, National Insurance number, plus starter declaration (A, B or C).
- Leavers carry a leaving date, so HMRC can close the employment and the P45 matches.
- Changes to address or name are reflected.
Pay and deductions
- Gross pay agrees to approved timesheets, salary changes and one-off payments.
- Tax codes are the latest issued by HMRC (P6/P9 notices or the software’s DPS feed).
- Student loan and postgraduate loan plan types match the latest notices.
- Pension deductions agree to the auto-enrolment status of each worker.
- Statutory payments are flagged as such.
Totals
- Year-to-date figures run on from the previous FPS; a jump means a missing or duplicated submission.
- The payroll summary agrees to the bank payment file.
After submitting
Keep the HMRC acknowledgement. The PAYE liability shown in the HMRC business tax account a few days later should equal FPS totals less any EPS reductions. Differences usually mean an FPS was rejected or sent twice.
Correcting an error
| Error found | Fix |
|---|---|
| Before the next payday in the same tax year | correct it in the next regular FPS, with updated year-to-date figures |
| Employee paid wrongly, needs an extra payment | run an additional pay run and FPS |
| Wrong payday or wrong employee details | send a corrected FPS; for an NI number, use the correction process the software provides |
| Error discovered after the tax year has ended | send an additional FPS for the old year (until 19 April) or an Earlier Year Update afterwards, depending on the year and software |
Penalties
HMRC can charge penalties for late FPS submissions, scaled by the number of employees, with the first late month in each tax year usually free of penalty. Repeated lateness is the main trigger. Interest and penalties also apply to late PAYE payments, which are separate from late submissions.
Linked processes
Employer-level reductions (statutory pay, Employment Allowance, CIS) go on the EPS. The ledger entries from each pay run are explained in payroll journal entries.