Making an Advance Payment in 2021 for 2022
Where an employee's pay will straddle two tax years
Please note credits and rate bands cannot be given in advance when an employee's pay straddles two tax years.
An employee is normally paid on a Monday, but will receive two weeks' pay on Friday 24th December 2021 in respect of Monday 27th December 2021 and Monday 3rd January 2022.
In this instance, the following will apply:
- the payment date must be reported as 24th December 2021 using the credits and rate bands for week 52 only
- the employee will subsequently not be paid in week one of 2022
- the employee will then get the benefit of two weeks' credits and rate bands in week 2 of 2022
- It is not appropriate to use week 53 in this scenario unless the pay date falls on 31st December 2021.
- Incorrect use of week 53 will cause underpayments for employee