Create and edit employee records

Before you process a pay run, you need to make sure

  • You have created a record for each of your employees

  • The information on each employee record is accurate and up to date

This article explains how to create and edit employee records. It also explains each of the options in an employee record.

Import employee records

If you have been using a different Payroll software, you can import your employee details using a Full Payment Submission (FPS) file. For more information, Import employees using an FPS file

Create or edit an employee record

To create a new employee:

  1. From the Employees tab, select Create Employee.

  2. Enter the employee's information then Save.

To edit an existing employee:

  1. From the Employees tab, select the relevant employee, then Edit.

  2. Change the information in the Employee Details tab as required, then Save.

The following sections explain more about what to enter.

Personal Details

Enter the employee’s name, date of birth, gender and national insurance (NI) number.

No NI number?

If the employee is under 16 or hasn't supplied a NI number

  • leave the NI number box blank
  • start the employee on a P46 basis

HMRC will trace the employee’s NI number and send you a CA6856 form to confirm the number.

Contact Details

Under Contact Details, enter the employee’s address and telephone number.

Email payslips

If you want to email payslips:

  • Include their email address and set a password.
  • Send the password to the employee. They will need it to view any payslips you send them by email.

Employment Details

Pay Cycle Select how often you’re going to pay this employee. This can be weekly, two weekly, four weekly or monthly.
Contracted Weekly Hours The set number of hours the employee works for you, per week.
RTI Pay ID

Every employee has a unique employee reference for your company. It's included in submissions to HMRC.

We automatically assign unique reference numbers to all new employees.

What if I'm transferring from another payroll system?

If it's part way through a tax year, but you're not re-processing any pay:

  • Leave the RTI Pay ID blank.

If you're transferring and re-processing pay for payments already on FPS:

  • Enter the RTI Pay ID from your old system.

If your previous payroll system was HMRC Basic Tools:

  • Find the RTI Pay ID under Employee Details, then click Employment Details and note the Payroll ID.
Works Number The unique code that identifies the employee in the company.
Start Date The date the employee started working for you.
Payment Method The method you pay your employee. If you select Bank Transfer, enter the account details.
Exclude from Auto Enrolment If you don’t need to assess this worker under automatic enrolment conditions, select this check box.

Directorship Details

If the employee is a director of the company, select the Is a Director check box.

Enter the following Directorship details:

Directorship Started Specify whether the employee became a director in a previous tax year, or during the current tax year. If the directorship started in the current tax year, you must also specify the start date.
Preferred Calc Method You can calculate Directors’ NI in two different ways.

Each method gives the same NI liability amount at the end of the tax year. NI payments within the tax year can vary under the two methods:

  • Calculate NI Cumulatively
    This is the default calculation method. This is often used if you pay your director irregularly. It uses annual earnings thresholds to determine the director's NI liability in a pay run.

  • Calculate NI Per Pay Run

    This calculation method is sometimes called the alternative method. It uses weekly or monthly earnings thresholds to determine your director's NI liability. It does not reference other pay runs.

    This is often used if you pay your directors regularly. It produces an average NI liability in each pay run. A balancing calculation is then carried out using year to date earnings thresholds. This makes any necessary correction to the director’s NI liability.

Find out more about director's NI

To change your employee from a director to a standard employee you will need to edit the employee record. Go to the Employees tab and click on the relevant employee record, then click Edit in the top right. Under Directorship Details clear the Is a Director checkbox.

The employee NI will calculate on a cumulative basis until the end of the current tax year. Next tax year, the NI calculation method will automatically revert to Per Pay Run.

Previous Tax Details

This depends on which form your employee has given you from their previous employment and the options selected on the form.

If you're unsure what to use when creating a new employee, you can use the HMRC online tool (opens in a new tab)

This is an existing employee Select this option if you are setting up an employee who already works for you and you pay them in the normal way. For example, if you’re setting up for the first time, you need to set up your existing employees.
Employee Declaration: P45

Select this option if the new employee has presented a P45 Part 3 issued by their previous employer. Then choose one of the following options:

Circumstance A

Use this if it's the employee’s first job since 6 April and they have not received any of the following:

  • Taxable Jobseeker’s Allowance
  • Employment and Support Allowance
  • Taxable Incapacity Benefit
  • State or occupational pension

Circumstance B

Use this if it's the new employee’s only job, but since 6 April any of the following apply:

  • They have had another job

  • They have received taxable Jobseeker’s Allowance

  • They have received Employment and Support Allowance

  • They have received taxable Incapacity Benefit

This also declares that they do not receive a state or occupational pension.

Circumstance C

Use this if the new employee:

  • Also currently has another job

  • Receives a state or occupational pension

Note: If you’re unsure which circumstance to use, you can use the HMRC online tool (opens in a new tab).
Employee Declaration: P46

Select this if the new employee doesn’t have a P45 from their previous employer. Then choose one of the following options:

Circumstance A

Use this if it's the employee’s first job since 6 April and they have not received any of the following:

  • Taxable Jobseeker’s Allowance
  • Employment and Support Allowance
  • Taxable Incapacity Benefit
  • State or occupational pension

Circumstance B

Use this if it's the new employee’s only job, but since 6 April any of the following apply:

  • They have had another job

  • They have received taxable Jobseeker’s Allowance

  • They have received Employment and Support Allowance

  • They have received taxable Incapacity Benefit

This also declares that they do not receive a state or occupational pension.

Circumstance C

Use this if the new employee:

  • Also currently has another job

  • Receives a state or occupational pension

This automatically applies tax code BR. This means there is no free pay allowance and gross pay gets taxed at 20%.

Unknown

Use this if you don’t have enough information on the employee to complete a P46.

This automatically applies tax code 0T on a Week 1/Month 1 basis with no free pay allowance. Tax calculates as normal, at 20%, 40% or 45% depending on the employee’s earnings. This is intended to encourage them to contact HMRC so the correct tax code can be issued.

Note: If you’re unsure which circumstance to use, you can use the HMRC online tool (opens in a new tab).


Depending on the Start Basis you chose, enter the following details:

NI Category

The employee’s National Insurance category. You must specify this for any new employees. The letters are A, B, C, J, H, M and Z.

Employees under 16, normally use letter A. This confirms that the employee is not yet due to pay NI. This is not deducted from their pay until they turn 16.

See the gov.uk site for more information about child employment (opens in a new tab)
Tax Code

The tax code determines the tax allowances your employee gets. You must enter this if the employee already works for you or has presented a P45 Part 3.

The tax code is on the P45 Part 3.

If the new employee does not present a P45, they must complete a P46. This says which tax code they should be on.

HMRC will notify you if the employee's tax code needs updating.
Leaving Date The date the employee finished their previous employment.
Week 1/Month 1 If your employee’s tax is calculated on a week 1 / month 1, or non-cumulative basis, select this check box. This bases the tax on their pay in the current period, instead of cumulative for the full year.
Final Pay Period The week or month of your employee’s final pay run in their previous employment.
Total Pay to date The total amount of pay your employee has received in the tax year to date, if any. You can get this from their P45 Part 3.

If they are set to Week 1/Month 1, set this value to zero.
Total Tax to date

The total amount of tax paid by your employee in the tax year to date, as specified on their P45.

If they are set to Week 1/Month 1, set this value to zero.

If they are not set to Week 1/Month 1, Payroll calculates their total tax liability for the tax year to date based on:

  • The employee’s tax code

  • The final pay period

  • Total pay to date

The calculated value should agree with the P45 Part 3. If the values don’t agree, the Calculated P11 Tax appears. This specifies the automatically calculated value.

The calculated value gets added to the P11. It's then used for tax calculations, rather than the value on the P45.
Student loan Select this if student loan repayments got taken by their previous employer.
Employer’s PAYE Ref This reference number identifies the employee’s previous employer if any. It appears on their P45.

After you complete all relevant fields, select Save.

The new employee now appears in your list of employees.

If you need to take further action to make the employee active, it will show in the status column. If an NVR response message appears, this may be due to an issue with the employee’s NI number.

Delete an employee record

You can delete an employee record that you've created, but not processed in a pay run.

To delete an employee record:

  1. From the Employees tab, select the relevant employee.

  2. From the Employee Details tab, select Delete. Please note, this option is only available if you've not processed the employee in a pay run.

  3. To confirm you want to delete the record, select Delete.

This employee will no longer appear in your employee list or on any payroll reports.

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