Payroll Earlier Year Update (EYU)

Create an EYU to correct employee payroll detail submitted to HMRC during the previous tax year.

How it works

  • Creating an EYU in Xero means you can submit changes to HMRC after the 19th April for your employee’s previous year-to-date figures stored in Xero.

    We added the EYU feature in 2017 with previous year-to-date figures for 2016/17.

  • You can use an EYU to update HMRC if an employee has left your organisation and you haven’t submitted their leaving date through your Full Payment Submission (FPS).

  • If your EYU includes changes to statutory payments, we'll automatically recalculate the statutory recovery values in the difference submitted and resend your updated month 12 EPS to HMRC.

  • To maintain accurate data, you can only create an EYU for the previous year if you haven’t posted a pay run after 19 April with a payment date in that same year. You will need to revert and delete the pay run before creating the EYU, or use HMRC’s Basic PAYE Tools (HMRC website) to submit your changes.

  • To reconcile the differences submitted in the EYU you will need to post a manual journal to the General Ledger.

Submit an EYU to HMRC

  1. In the Payroll menu, select RTI Filings.
  2. Click Create 2016/2017 Earlier Year Update.
  3. Click Update in the row next to any employee you want to include in the submission.
  4. (Optional) If an employee has left your organisation and you haven’t submitted their leaving date through your Full Payment Submission (FPS), check that their leaving date is correct and click Done to send an EYU with this information to HMRC.
  5. Review the year-to-date figures for the selected employee and overwrite them with the corrected year-to-date figure to show the 'Difference' to be submitted.

    A negative figure can not be entered. To update HMRC with a NIL year-to-date value, simply enter 0.00. You can reset any changes to the original filing amount by clicking Reset. The original filing will be displayed in the Difference column.

  6. Click Done to complete details for that employee.
  7. Repeat for each employee you’d like to include in the submission.

  8. Click Submit EYU.

Xero will electronically submit your EYU for 2016/2017 to HMRC. It can take HMRC up to 48 hours to accept or decline a submission. If your submission is declined, you will need to update or delete the existing submission. Once submitted, Xero will also update some of your payroll reports with changes from the EYU, such as the P11 and P32.

A new EYU for the same tax year can not be created if a draft, pending, or declined EYU exists for the same tax year.

Review and update existing EYU submissions

  1. In the Payroll menu, select RTI Filings.
  2. Select the year in the dropdown menu. Your EYU for that year will be displayed with status on the right.
  3. Click the submission name to display the employees and changes included in your submission.
  4. (Optional) If the submission is declined, click Download HMRC Response to see the reason.
  5. (Optional) Revert the EYU submission to draft, update the details and resubmit.