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UK Payroll – A year in review

Posted 5 years ago in Xero news by Xero
Posted by Xero

2016 was a busy year for UK Payroll in Xero. We delivered a host of improvements to help accountants, businesses and their employees manage their payroll more efficiently whilst staying compliant with legislation – but we don’t intend to rest on our laurels. As we ring in the new year we thought we’d reflect the key features that were launched last year as well as giving you a sneak peek at what’s coming soon:

Launched in 2016:

Payroll goes mobile

Now you can manage payroll even when you’re not at your desk. Xero Me, our iPhone and Android app, eases some of the key functions that come with running a business and managing staff. No other accounting software makes it so easy for business owners and their employees to manage time off, view payment information and more – from any device at any time.

Users can submit or approve leave requests directly from their mobile and see if their request has been approved or declined. You can also see leave balances and upcoming leave in a handy calendar.

Employee Timesheets

Doing your timesheets used be a time consuming task, but now it’s a breeze with Xero. Staff can enter their own hours and submit them for approval, during downtime or even while they’re on their way to work. They are even available in Xero Me, so they can be done whenever and wherever you want. It’s a great timesaver for administrators, and it makes doing timesheets a simple task.

Managing workplace pensions and auto enrolment

We’ve launched new features that streamline and automate the work associated with auto enrolment and workplace pensions. They help you comply with legislation by allowing you to assess your workforce, manage postponements, opt ins or opt outs and automatically enrol employees into a workplace pension.

Once the staging date has been reached, Payroll in Xero will automatically assess employees and auto enrol them if they meet the requirements.

Each time the pay run is posted after the staging date, the employee assessment happens automatically to identify any new or existing staff that should then be auto-enrolled. Pensions contributions are automatically deducted from the pay run and a CSV output file containing the key pension information needed by providers can be created.

Then when it comes to review time, our new Pensions Contribution Report can show you what contributions have been deducted in any given period.

Auto-enrolment worker communication

We launched another piece of our auto-enrolment puzzle in August. Businesses are legally required to send correspondence to employees about their auto-enrolment status. Xero will let you know what you need to send to each employee, when you need to send them and automatically generate the right letter for you.

Coming soon

Easier statutory sick and maternity pay management:

We’re almost ready to launch new functionality in Payroll in Xero to help you process Statutory Maternity Pay and Statutory Sick Pay. These will be the first in the Statutory series, with others following on a little later.

You will be able to enter statutory leave for any employee in the ‘Time Off’ section of Payroll. Xero will do all the background calculations and checks for you, and if the leave is allowable it will add the relevant pay items to the pay run with the appropriate amount to be paid.  This should be a great time saver as you won’t need to use the HMRC calculator any more.

Send pension information to your provider with ease

We want to make it even easier for you to manage your pensions burden, so we will be releasing seamless data transfer from Xero to the major market pension providers. This will allow for auto-enrolment compliance, all the way from assessing your employees through to sending data to your provider. Through 2017 we’re aiming to allow seamless data transfer with the following pension providers: NEST, NOW:Pensions, The People’s Pension, Smart Pensions, Aviva.

If your fund does not allow seamless transfer then you will have to manually update their systems using the CSV output file.

Get up to speed with payroll today

No matter whether you’re a small business owner or an accountant, it’s never too early to start learning about payroll and auto-enrolment.

We’ve created a handy auto enrolment checklist for small business owners, as well as some in-depth payroll and auto-enrolment training. It’s also really easy to find a certified Xero advisor if you need any help or advice.

For advisors we’ve got some great self paced learning courses on payroll and auto-enrolment as well as regular monthly update webinars.


February 22, 2018 at 10.07 pm

Using Xero was a good decision for my small business, but running payroll on Xero was a mistake. The coding of PAYE to so many different accounts and the inability to reconcile a single PAYE bank payment to these multiple accounts has been a big problem and left our accounts in a mess.

April 23, 2018 at 10.29 pm

thanks for this very useful feedback

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