Payroll - Good Friday 2007
A high-level meeting between payroll industry representatives and HMRC has resulted in some revised concessionary guidance which resolves the issues around what started being known as the Good Friday 2007 Bug.
The guidance we issued in September raised a number of practical difficulties for some employers and could lead to inconsistent PAYE deductions for employees at the beginning of the tax year. It is therefore supplemented by the guidance set out below. This will also apply when Good Friday next falls on 6 April in 2012. This guidance does not replace or alter the existing guidance in booklet CWG2 about regular paydays falling in week 53 of the tax year.HMRC
When the payment date is a non-banking day
Should payment be made on the last working day prior to the regular payment day - as a result of the usual pay day falling on a non-banking day (i.e. Saturday, Sunday or bank holiday) - the payment may be treated for PAYE and Class 1 NIC purposes as having actually been made on the regular payment day.
So payments that would have normally been paid on 6 through to 9 April (tax year 2007-08) but which instead were paid on Thursday 5 April 2007 (tax year 2006-07), fall under this guideline. They may be treated for PAYE/NIC purposes as having been paid on 6 April and 9 April respectively - so treated as belonging to the first tax period.
This resolves the previous HMRC position that payments having been made on 5 April would have had to be treated as tax week 53, with the following payment due on 13 April being treated as week 2.
Weekly payroll dates for 2007
According to the new guidelines, a weekly payroll which normally pays on Fridays should now have the following payment dates across the tax year end in 2007:
- Friday 23 March 2007 is tax week 51.
- Friday 30 March 2007 is tax week 52.
- Thursday 5 April 2007 (Friday 6 April is Good Friday) is now tax week 1.
- Friday 13 April 2007 will therefore be tax week 2.