Switching Payroll Providers: The Complete Guide
Switching payroll providers can feel daunting. Many business owners stick with clunky, expensive systems simply because they fear the migration process. However, with the right plan, moving your payroll is straightforward and can save you hours of admin every month.
The Best Time to Switch
While you can switch at any time, the start of a new tax year (6 April) is the cleanest point for a migration. If you switch mid-year, you'll need to transfer "year-to-date" (YTD) figures for every employee.
Step 1: Gather Your Data
Before you give notice to your current provider, ensure you have access to:
- Employee Details: Names, addresses, NI numbers, and tax codes.
- YTD Figures: Total pay, tax, and NI paid so far in the current tax year.
- Pension Data: Your pension provider details and contribution rates.
- HMRC Credentials: Your PAYE reference and Accounts Office reference.
Step 2: Parallel Running (Optional but Recommended)
For larger teams, it's often wise to run your payroll on both the old and new systems for one month. This ensures the calculations match exactly before you make the final cut-over.
Step 3: Inform HMRC
You don't need to "close" your PAYE scheme when switching software. You simply start submitting your RTI files from the new platform. HMRC's systems are designed to handle this transition seamlessly.
Step 4: Employee Communication
Transparency is key. Inform your team about the change, when they can expect their first payslip from the new system, and any changes to how they access their digital payslips.
Step 5: Final Submission from Old Software
Ensure you've completed all final submissions (FPS/EPS) from your old provider before losing access to the system. Keep copies of historical reports for your records.
Ready to make the move? At Workmax, we offer free implementation support to help you migrate your data securely. Most small businesses are up and running on Workmax in less than an hour.
