If you make a mistake in your processing, you need to correct it. For example, you forgot to pay overtime to an employee, or paid too much commission.

To resolve this, either reprocess the affected period correctly, or make the correction in the next pay period.

If you decide to adjust the next normal pay period, you don't need to submit a Full Payment Submission (FPS) adjustment.

Your software includes the latest values in the FPS, and you pay HMRC the value on your P32.

Before you start

Keeping the payslip clear

To make the adjustment clear on the employee's payslip, you can set up a payment or deduction specifically for the adjustment.

If you set up a new payment or deduction, mirror the settings from the original payment or deduction you're correcting into the new one. Check the tables below for further information.

For example, select the same pension options from the pay element you overpaid with, on the deduction you use to correct it.

National Insurance

Sometimes, the employee paid extra NI in the overpaid period that they won't get back if you correct it in the next period.

To change the NI in a period you overpaid, reprocess the employee's payment.

Correct an overpayment

If you've paid an employee too much, you can set up a deduction to correct this in the next period.

Check the table below for whether to set the deduction as pre-tax or post-tax, based on the settings on the overpayment.

Correct an over-deduction

If you've paid an employee too little, you can set up a payment to correct this in the next period.

Check the table below for whether to set the payment as pre-tax or post-tax, based on the settings on the overpayment.

Pensions

If the employee overpaid their pension due to an overpayment, you can process a pension refund manually where required.