When an employee leaves your company, you need to provide them with a P45 and inform HMRC.

 TIP: If you need to pay a leaver earlier than your normal pay day, follow the pay a leaver mid month article. 

Process your employee's final pay

Before you start, we recommend you read our article on what to consider before you make an employee a leaver.

1. Select Payroll then Change Process Date.
2. Enter the required pay date, then select OK.
3. Select the employees you want to pay, then select Enter Payments.
4. Enter the payment details for any other employees in the pay run as normal.
5. For the employee who has left, enter their final payment details.
6. Select the Select this check box if your employee is leaving and this is their final payment checkbox.
    NOTE: Your software calculates outstanding payments, such as statutory payments, when you select this checkbox.
7. If required, check and pay any outstanding amounts due, such as holiday pay.
8. Check your employee's net pay:
   • If it's £0 or above, continue to Step 9
   • If it's a negative value, ▼ click here to find out what to do

     This could happen, for instance, if they've taken more holidays than they've accrued and this deduction is greater than their payments.

     You can't process negative net pay in Sage 50 Payroll. As an alternative, enter a post tax post National Insurance (NI) payment to increase their net pay to £0

     This way you can finish processing the period, and agree with the employee how or whether to recover the post tax payment you added.

9. When you're finished processing the employee's pay, select Close.
10. Print any of your normal pre-update reports, such as payslips and payment summaries, as usual.
11. Update records for the pay period.

You can now make the employee a leaver and print their P45.