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function, tax processing had always been an area of high manual activity, including the checking processes. It was also the item most received in our post. With thousands of new starters across the partnership each year, and peaks in September for school staff, we could see the obvious benefits of trying to automate tax processing. However, this was proving hard as there were so many variables, particularly with processing P45s. Therefore, we struggled to find a cost- effective solution which freed up the time of our payroll professionals. One afternoon we were feeling ready to give up on the idea of automating the tax processing when one of the team just casually said, “Why don’t we make it self-service?” You could almost see the lightbulbs appearing above the heads of our transformation team, and we set to work putting a team of professionals together to map out the options. The Starter Checklist was the first item to tackle. Employees were already completing the online version so we only needed to build this into a self-service form that would process their answers and update the payroll system. Easy! Then came P45 processing and it was clear this was going to be much harder. For those of us who have been in payroll for a long time, processing P45s was probably one of the first things you learned. The rules were almost second nature to the project team, so I think we’d forgotten how complicated it could be. As we started to map out the various deviations, we realised that without extra validation we could be introducing the risk of incorrect tax calculations. So, we went back to the drawing board and set about designing some more validation to ensure we only captured accurate P45 data at the right point when an employee joined. In other words, the ability to enter a P45 was only offered to new starters who hadn’t had a P6 provided by HM Revenue and Customs (HMRC). When considering making any development changes to our systems, we always start with the problem statement. In this case, it was reducing the cost of manual processing in our team. As we started to look at some of our other data, we identified that we were getting around 350 queries a month in relation to tax code changes, with most of these coming through to us on or around pay day. So, rather than building
a solution which would only capture tax information from new starters, we started to consider a solution that would allow all employees to see their tax code history and the My Tax app was born. My Tax was to be made available to all employees alongside the other apps in the portal they use each month. Tax code changes made by HMRC can be viewed in near real time, so our employees can be better prepared for pay day. We hoped this would reduce the volume of enquiries from individuals asking why their tax code had changed but that it would also even out the distribution of enquiries to make our busy periods that little bit easier. As our colleagues in information technology focussed on the build, we set about making some decisions about checking processes. We were going to make obvious time savings for our team but there was still a nervousness about asking employees to input their own tax information. Employees are still required to upload a copy of their P45 pages before they can submit their information, so we determined that we would want to do some checks for accuracy of input. Our plan was to 100% check every submission for the first two months. As we watched the completed self-service forms come in, we noted a small number of employees leaving the taxable pay and tax paid fields blank despite having amounts on their P45. We contacted them to ask why and discovered there was some confusion about what was being asked for. We had tried to make the form match the layout of a P45 to make the input intuitive for employees, but it was clear that we would benefit from offering more written guidance, which we implemented. At the end of our 100% checking period, we decided to implement exception checking for potential errors in input which we identified through reports. Exceptions are noted as mis-matching taxable pay and tax paid, blank taxable pay and / or tax paid and high value tax refunds. We’re thrilled that since the app was made live at end of January 2025, we’ve had nearly 300 Starter Checklists and P45s input via self-service. Not only has this saved precious payroll professional resources but it simplifies the process for new employees. Frontline staff can focus on learning their new roles and be confident they’ve submitted their tax information quickly and easily. n
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| Professional in Payroll, Pensions and Reward |
Issue 112 | July-August 2025
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