Setting the Termination Date

1. Navigate to the Employee Record > Payroll tab > Pay Component subtab and open in edit the current salary/wages payment components (you will also need to do this for other recurring pay components if you wish to pro-rata them on the same basis as salary e.g. allowance employee gets every month)
   
2. Enter the termination date into the end date field on the pay components
3. A pop up will appear asking if you want to set this as the termination date - click OK to confirm this is a termination
4. SAVE
   

This will set the termination/release date on the Human Resources tab.

If the employee’s leave date has already passed you will be able to see that the employee record status will change to terminated.

Annual Leave Payout & One Off Pay Details

If applicable to the Employee, an entry for Annual Leave Payout will need to be included in their final payment.  

First you will need to work out the annual leave that has been taken and whether this is over or under the pro-rata entitlement (from the start of the annual leave year to their leaving date). For this you will need:

• the number of days/hours entitlement they have accrued
• the number of days/hours they have taken

Once you have worked this out you will need to enter this as a one off pay detail.

1. Navigate to Payroll Administration > Payroll Activities > Enter One Off Pay Details
   
   That will bring up the enter one off details page where you have to put in:
2. A date within the correct period.
3. The employee who you are entering the payout for
4. Sub Type – “Annual Leave Payout (UK) “
5. Quantity – amount of hours you want to pay, you can also deduct annual leave e.g. -8 if employee has overtaken 8 hours annual leave
6. Click Add

7. You may also want to enter further lines at this stage such for payment in lieu of notice or a statutory redundancy payment

8. Click Submit
   

These payslip details will be picked up in the next pay run.

Run the Pay Run as usual - more information on running a payroll on the Pay Run Processing Guide

Check the payslip prior to approval to make sure that the salary/wages pay components have been calculated as expected on a pro rata basis to the leave date and that the annual leave payout and other one off details are present.

Reporting

When you’ve run the payroll for the period that the employee leaves you need to make sure you report them as leaving employment on your FPS.

Check this prior to submitting the FPS by sorting the leave date section on the FPS page with dates at the top.

Generating a P45

1. Navigate to Payroll Administration > UK Reports > Employee Termination > New
   
2. Enter the employee name you are creating the P45 for
   By selecting the employee the key data on this page will autofill
3. If you hold a cumulative tax code for the employee please ensure that Week Number or Month Number fields have a value – if missing please update with the employees last payment week or month

4. Ensure that the company address has pulled through, enter this if not

   The address can be entered in the Payroll Configuration record to be auto-completed in future follow this guide to Add Address to Payroll Configuration

5. Ensure that all other information is correct and select Save
   
6. By clicking "Save" this will have generated the P45 PDF. You can still edit the Termination Record at this point to make any changes if required, each time you save the record a new P45 PDF will be generated to reflect the updated information.
7. Once you have saved the Termination Record and the P45 PDF is generated you will see the "Send P45 PDF" button - click this to email the P45 PDF to the employee. 
   
8. Once you have done this you will see a successful email message, the "Emailed" checkbox is ticked and the email sent is stored in the Mail Merge Tab
9. You will now no longer be able to edit the Termination Record or update the P45 PDF, you will only be able to email the P45 this way once as the button will not be available again, if you need to send a second copy you will need to download and email this separately.
   

After their final Pay Run and prior to initiating the next Pay Run you will need to follow the Excluding an Employee from Payroll guide to make sure they are not included. 

To review existing Termination Records:

1. Navigate to Payroll Administration > UK Reports > Employee Termination 
   
2. You can then see the list of existing Termination Records. Click "View" next to the one you want to review to open this.
   

Batch Terminations 

If you have multiple terminations to process within one pay run you can use the Batch Terminations process.

Payment After Leaving

If you have to pay an employee after they leave 

• use tax code 0T on a ‘week 1’ or ‘month 1’ basis (S0T if the Scottish rate or C0T if at the Welsh rate)
• deduct National Insurance (unless it’s a redundancy payment) and any student loan repayments
• report the payment and deductions in your next FPS, using the employee’s original ‘Date of leaving’ and payroll ID, and set the ‘Payment after leaving’ indicator
• give the employee written confirmation of the payment showing the gross amount and deductions

Do not give the employee another P45.

Processing the Payment

1. Navigate to the employee record
2. Ensure that their Payroll Employment Status is not "Terminated" but is their previous status (e.g. Full Time) 
3. Ensure the employee's pay frequency is not "exclude from payrun" and is set to their previous frequency (e.g. Monthly)
   
4. If you do not need to pay any regular payments (e.g. Base Salary) leave these Pay Components with the pay frequency of Exclude from Pay Run and an end date
5. Create the one off details you wish to pay the employee as in 
6. Add the employee into your next pay run as you would usually do
7. When at the process payslips stage in the payrun open the employee's payslip record
8. Click recalculate
   
   
9. When on the recalculate payslip page ensure you tick "Payment After Leaving" this will set the tax code to 0T and tick the W1/M1 flag.
10. Click Recalculate
    
11. Review the payslip to ensure it only includes what is required and is as expected - you will see the indicator is set on the payslip record
    
    
12. Continue with the payrun as usual
13. Check that the employee is being reported correctly on the FPS - original leave date, Payroll ID etc.

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