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Get ready for the new tax year

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Summary

How to set up Sage Payroll software to process payroll in the 2025 tax year.

Description

Once you complete your payroll processing in the 2024 tax year, you need to create the 2025 tax year for each of your payrolls.

Before you set up the new tax year, check you're using the latest version of Sage Payroll.

This is stage three to complete year end. Go to the Payroll Year End 2024 hub to see them all.

Resolution

Watch the video

Create and open the 2025 tax year

  1. Open Sage Payroll 2024 and log in to a payroll as normal.
  2. Go to Year End, then Tax.
  3. Select Set up 2025 Tax Year. You must be at EOP or this option isn't available.
  4. Follow the instructions then select Close.
  5. Close Sage Payroll 2024.
  6. From the Windows desktop, double-click Sage Payroll 2025.
  7. Log in to a payroll as usual.
    NOTE: Before you start processing in the new tax year, check your version is 28.0 or above. You can find this in the top left-hand corner of Sage Payroll.
  8. Repeat the above steps for all payrolls you want to use in 2025.

Set up the new tax year calendar

  1. Go to Company/Payroll then select Calendar.
  2. Go to the New Calendar tab.
  3. Enter the calendar details for period one of the new tax year.
    CAUTION: Enter the correct dates for period 1 of 2025 - the dates you enter as 1st Pay Period Dates determine the dates used when setting later pay periods in 2025.
    Payroll Frequency First Pay Date Range
    Weekly January 1 - January 7
    Fortnightly January 1 - January 14
    Monthly January 1 - January 31
    Bi-monthly January 1 - January 16
    4-Weekly January 1 - January 28
    Quarterly January 1 - March 31
    Your pay date must be a date within the allowed date range for that period. The Pay Date field is the date that you pay your employees wages/salary processed in the pay period. This date is included in every payroll submission to Revenue for your employees.
  4. Select Update - you return to the Calendar Details tab, where you can view all periods/dates for your payroll year.
  5. Check the details are correct in the Financial Year Details section.
  6. Select Save.
NOTE: You can view our set up the payroll calendar guide for more information about the payroll calendar.

CWPS year end tasks, if applicable

If you're part of the Construction Workers' Pension Scheme (CWPS), when the CWPS year ends, you must clear down the CWPS history and balance from your employee records. You must also set up the CWPS calendar for the new CWPS tax year.

 NOTE: The 2025 CWPS year starts on 30 December 2024.

Use our article to complete your Construction Workers' Pension Scheme (CWPS) year end tasks.


Set period one of the 2025 tax year

  1. Go to Processing then select Set Period.
  2. In the New period to process box, enter 1.
  3. Confirm the dates and information are correct for the first period of 2025. If not, edit as required.
  4. When you finish, select OK.
    NOTE: If your 2024 holiday year ended on 31/12/2024, you automatically receive the option to roll forward your holiday and absence years.
  5. Edit the settings if required, then select Continue Set Period.

Clear your financial year end balances, if applicable

The tax year runs from 1 January to 31 December, however your company's financial year may not coincide with these dates, for example, 1 August to 31 July.

NOTE: If your Financial Year end matches the Tax Year (in the payroll calendar), you're automatically prompted to Clear down financial balances when setting your first period of 2025. 

This involves clearing any financial balances that you don't want in your new financial year and allowing your reports (Cost Analysis, Payments, Deductions) to show the financial year information.

NOTE: You don't see this panel if your financial year doesn't match the tax year. You can check your payroll calendar for when your financial year starts.


Enable CSO reporting, if applicable

If the Central Statistics Office (CSO) has selected your company for surveying and you haven't done so already, you must set up Central Statistics Office (CSO) reporting.


Assign ASC settings to your employees, if applicable

Additional Superannuation Contribution (ASC) calculations replaced Pension Related Deduction (PRD) in 2019. ASC is only relevant to public sector employees.

If you have employees that are liable for ASC deductions in 2024, you must assign the appropriate ASC settings within their records.

Find out how to assign Additional Superannuation Contribution (ASC) settings to employees.


Validate your payroll data in 2025

  1. Go to Reports then Validate Payroll Data.
  2. If any errors appear on this report, you must resolve them now.

What to do next

Once you complete the sections above in each of your payrolls, you're ready to process your payroll, as normal in the new tax year.