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Payroll Year End is just around the corner, and the pressure to ensure all Payroll Year End related activities is heating up.
Whilst Payroll Year End is traditionally handled by payroll professionals, a growing trend within SMEs is that these processes are now falling to HR professionals. This comes with a variety of challenges, such as balancing Payroll Year End alongside other HR priorities, while also ensuring compliance across the business.
Increasing pressure on employers from legislative changes, can make navigating payroll compliance at Payroll Year End difficult. This is especially true for solo HR professionals, or businesses with a small HR team, and limited payroll expertise.
Staying ahead of impending changes in the new tax year is essential for HR professionals, and although Payroll Year End has traditionally focused on meeting deadlines, the focus is now shifting towards assessing the impact of these changes.
By staying ahead, it enables HR professionals to avoid costly mistakes and ensure compliance.
HR Compliance: Payroll Year End
The new financial year often comes with a host of legislative updates, ranging from the increase in Minimum Wage, Employment Allowance and Statutory Sick Pay (SSP) to the introduction of the new Neonatal Leave.
For HR professionals, the changes can have an all too real impact on day-to-day functions around PYE, and in order to remain compliant HR professionals managing payroll have to face these changes head on. The risks of not doing so could result in businesses being exposed to increased costs and impacted payroll implementation.
New legislation is paramount when calculating year-end payroll, making it the responsibility of HR professionals to understand and implement it. Although there’s no “quick fix” – aside from implementing HR and payroll software – being prepared can help to take some of the stress out of these changes.
“As the new tax year kicks off, ensure your payroll is on track by reviewing employee data for accuracy and completeness. With the National Living Wage rising to £12.21 from April 2025 for workers aged 21 and over, now’s the time to analyse pay gaps, understand their drivers, and address disparities. You should also ensure employees are paid correctly—navigating the complexities of payroll regulations and pensions on an ongoing basis. Looking ahead, with Employer National Insurance contributions jumping to 15% next April, consider exploring salary sacrifice options for pensions to ease that future NI burden while enhancing employee benefits. Finally, you should assess if your HR team can manage this increasing workload or if a payroll expert could sharpen your efficiency” – Suzanne Gallagher Payroll Product Manager, Employment Hero
The Future of Payroll Year End for HR Professionals
In an ever-evolving digital world, it’s not just compliance changes HR professionals need to be mindful of.
AI and automation have come a long way over the past few years, and the use of platforms that take advantage of this technology is growing. This extends to HR and payroll software. Automated, intelligent, and AI-driven solutions are likely to become the norm saving HR professionals from tedious tasks, the risk of human error and instead allowing them to focus on more strategic initiatives. For Payroll Year End, AI and automation could mean less of a scramble to gather data in the lead up, and instead, a few clicks in an employment platform and it’s done.
Employment Hero’s research found that on average businesses are currently using six logins to manage one team, and SMEs are spending on average £33K on platforms for managing employment. It’s definitely a bit much. Integration between HR and payroll could drastically simplify HR processes, especially around year-end when having a single source of truth is imperative. But it’s not only a matter of simplifying processes, for the majority of businesses, cost is a factor, so reducing expenses where possible is always a consideration. Based on Employment Hero costs and average SME size, it’s estimated SMEs could save 16K per year by consolidating into one Employment Operating System (OS).
Work smarter with integrated HR and Payroll
According to research conducted by Employment Hero, 47% of Employment Hero HR customers either solely manage payroll as part of their HR responsibilities, or manage the bulk of it with final checks from finance. HR professionals managing payroll, and the integration of these two functions, appears to be a growing trend. But with compliance being an integral part of that, HR leaders are going to find that they need additional compliance support.
Unified functions are likely to push software solutions to evolve, and we are likely to see HR and payroll platforms integrating. This is exactly what an Employment Operating System does. These solutions take advantage of intelligent automation to manage HR and payroll, alongside other employment processes, such as benefits and hiring. Employment OS is designed to reduce errors, streamline processes and make the lives of HR professionals easier.
And Employment Hero’s Employment OS does just that. With all the traditional isolated aspects of employment in one seamless, human and AI-powered solution that empowers HR professionals to manage HR, payroll, hiring and more in one place, Payroll Year End has never been simpler.
