To Record a Deceased Employee

You need to consider whether the employee was due wages, due to make payments such as student loans or child support payments, or was receiving any statutory payments etc. Earnings of an employee who dies before payment is made are subject to normal tax rules but no National Insurance contributions are due.

For full details of HMRC requirements for processing deceased employees, visit www.gov.uk/what-to-do-when-an-employee-dies.

Follow these steps after final calculations of the employee's payments and deductions.

  1. Open the Payroll folder and then click Processing or click the Payroll & HR tab on the Ribbon Bar and then click Payroll - Processing.

  2. If you are using groups, in the Select Payroll Groups list, click to select the group(s) you want to process and then click OK.

  3. Retrieve the relevant employee, click Action and then click Details & Bank. The Details & Bank form is displayed. Tick the Deceased box and click OK. A message is displayed when this box is selected that reminds you of the importance of ensuring that the correct NI code is used. No NICs are due on the earnings of an employee who dies before payment is made but PAYE must still be paid.

  4. Click Action again select Leavers. In Leaver Flag, select L (Leaver this period), enter the date the employee died and the leave period. Then click OK. You then need to send the employee's P45 to HMRC and print the remaining parts for the employee's personal representatives.

  5. Open the Payroll folder and then click Periodical Reports or click the Payroll & HR tab on the Ribbon Bar and then click Payroll - Periodical Reports.

  6. Click P45. If you are using groups, in the Select Payroll Groups list, click to select the group(s) you want to process and then click OK.

  7. In the Range boxes, select the employee's code. The next step depends on whether you will submit the P45 to HMRC online (most employers must submit P45s online) or submit it on paper: