A pay period is the earnings period in your payroll. How many pay periods you have depends on your payroll frequency – how often you run your payroll.
The payroll frequencies you can choose from are:
- weekly
- fortnightly
- monthly
- quarterly
- four-weekly
- four-four-five.
Weekly (once every 7 days)
If you run your payroll weekly, you’ll usually have 52 pay periods a year.
But, some years could have extra pay periods, so you’ll have to adjust the number of your pay periods. See Extra pay periods below for more about this.
Fortnightly (once every 14 days)
If you run your payroll fortnightly you’ll usually have 26 pay periods in a year.
But, some years could have extra pay periods, so you’ll have to adjust the number of your pay periods. See Extra pay periods below for more about this.
Monthly (once every calendar month)
You’ll have 12 pay periods a year.
Quarterly (once every three calendar months)
You’ll have four pay periods a year.
Four-weekly (once every 28 days)
You’ll usually have 13 pay periods. But, some years could have extra pay periods, so you’ll have to adjust the number of your pay periods. See Extra pay periods below for more about this.
Four-four-five (4-4-5)
This is two 4-week payrolls followed by a 5-week payroll, covering 13 weeks altogether. You’ll have four 4-4-5 pay periods in a year.
Extra pay periods
If you run your payroll weekly, two-weekly or four-weekly, some years will have extra pay periods.
When this happens you’ll need to complete extra pay periods to finish your PAYE tax year. Here’s how you do this.
Log in to now:u and go to your Payroll page, where you’ll see your active payrolls. When your next pay period is 1, you’ll be able to edit this pay period and its start dates to match your extra pay period.
Once you’ve uploaded your pension data files for this pay period, the next expected pay period will be 1. You’ll be able to edit this again to re-set your pay periods for the start of the new payroll year.
What do extra pay periods mean for workers?
HM Revenue & Customs (HMRC) says you must give your workers an extra amount of tax-free pay – even if their tax-free pay for the year has been allocated. This helps to protect workers’ take-home pay and makes sure the tax for that week doesn’t vary too much from the usual amount.
Once the tax year ends, HMRC will recover the underpaid tax given by the extra personal allowance, by sending out a P800 calculation.
If you have more questions about extra pay periods, talk to us on webchat.
How to choose your payroll frequency
In now:u, go to Payrolls > Payroll details. Under the Payroll name box you’ll see another box saying headed Choose payroll frequency. This has a drop-down menu. Choose your payroll frequency from the drop-down menu.
You can choose your payroll frequency when you add a new payroll. And, you can edit an existing payroll to change the frequency by following the steps above.
