Add payroll opening balances

If you switch to payroll in Xero during a financial year, add your organisation's opening balances so they're included in your year-to-date totals. This includes statutory payments made to employees, payments recovered in the current tax year, Small Employers' Relief (SER) compensation received from HMRC, and any Employment Allowance balance.

Before you start

Add opening balances for your organisation

  1. In the Settings menu, select General Settings.
  2. Under Features, click Payroll Settings.
  3. Click the Opening Balances tab.

    If you receive a message saying you don't need opening balances, you don’t need to continue.

  4. Select the tax year you want to add opening balances for.
  5. Enter your opening balances for statutory pay.
    • Statutory payments made to employees.
    • Payments recovered from HMRC in the current tax year for statutory payments already made to employees. For example, statutory sick or maternity pay.
    • SER compensation received in this tax year.
  6. Enter your opening balances for employment allowances.

    This is the amount you'll recover (unrecovered balance) for the tax year, out of the allowance entitlement.

    Employment Allowance (gov.uk website)

  7. Click Save.

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