Key facts
- Errors in a closed tax year are corrected with a further (earlier-year) FPS showing the corrected year-to-date figures.
- The EYU applies only to 2019/20 and earlier — HMRC no longer accepts EYUs for 2020/21 onwards.
- Corrections can be made for any of the previous 6 tax years — all of which now use the FPS method.
- The earlier-year FPS reports corrected absolute year-to-date figures; the old EYU reported only the difference.
- Submit the correction as soon as you discover the error — there is no specific deadline other than the 6-year limit.
What Is an Earlier Year Update?
An Earlier Year Update (EYU) was a special RTI submission that corrected payroll data from a previous tax year. HMRC accepts EYUs only for tax years 2019/20 and earlier. Once the final FPS has been submitted and the tax year has closed (after 19 April), any errors in the reported figures for 2020/21 onwards are corrected by sending a further FPS — often called an earlier-year FPS — with the corrected year-to-date figures.[1]
When You Need an Earlier-Year Correction
Common scenarios that require a correction to a closed year include:
- Discovering that an employee’s gross pay was reported incorrectly
- Finding that the wrong tax code was used for part of the year
- Realising that NI contributions were calculated on the wrong category letter
- A late P45 arriving after the year has closed, changing the figures
- Correcting student loan deduction amounts
- Adjusting statutory payment figures (SSP, SMP, etc.)
How an Earlier-Year Correction Works
The earlier-year FPS reports the corrected absolute year-to-date figures for the affected employee (the old EYU reported only the difference):[2]
| Field | Originally Reported | Correct Amount | Reported on the Earlier-Year FPS |
|---|---|---|---|
| Gross pay | £25,000 | £26,000 | £26,000 (corrected YTD) |
| Tax deducted | £2,486 | £2,686 | £2,686 (corrected YTD) |
| Employee NI | £994 | £1,074 | £1,074 (corrected YTD) |
| Employer NI | £2,386 | £2,536 | £2,536 (corrected YTD) |
How to Submit a Correction
- Identify the error — determine which employee, which field, and the correct figures
- Work out the corrected year-to-date figures for the affected tax year
- Use your payroll software — most software has an earlier-year correction function in the year-end or corrections area
- Submit electronically — the earlier-year FPS is sent to HMRC through the same RTI channel as a normal FPS
- Keep records — document the reason for the correction and retain for your payroll records
Time limit: You can correct any of the previous 6 tax years. There is no specific deadline within that period — submit as soon as you discover the error. However, the sooner you correct it, the sooner HMRC can adjust the employee’s records.
EYU vs Earlier-Year FPS
Which submission applies depends entirely on the tax year being corrected:[3]
| Method | Tax Years | Data Format |
|---|---|---|
| EYU (historic) | 2019/20 and earlier only | Differences (+ or −) from original |
| Earlier-year FPS | 2020/21 onwards | Corrected year-to-date absolute figures |
Because corrections can only go back 6 years, every tax year still open for correction now uses the earlier-year FPS method.
Tip: Before submitting a correction, check whether the error has already been corrected through HMRC’s own processes (such as a P800 reconciliation). If HMRC has already adjusted the employee’s records, a further correction may cause confusion rather than resolve it.
Frequently Asked Questions
How do I correct a previous tax year now?
For 2020/21 onwards, send a further Full Payment Submission (an “earlier year FPS”) for the affected employee showing the corrected year-to-date figures for that tax year. If the error is in the current tax year, simply correct it through your next regular FPS by adjusting the year-to-date figures.
What information goes on an earlier-year correction?
The earlier-year FPS contains the corrected absolute year-to-date figures for the affected employee. For example, if gross pay was reported as £25,000 but should have been £26,000, the correction reports £26,000 as the year-to-date figure, along with corrected tax, NI, and any other affected deductions.
Will a correction trigger a tax refund for the employee?
It depends on the correction. If it shows that too much tax was deducted, HMRC may issue a P800 tax calculation to the employee and refund the overpayment. If too little tax was deducted, HMRC may adjust the employee’s current tax code to collect the underpayment.
Are EYUs still accepted?
Only for tax years 2019/20 and earlier. HMRC stopped accepting EYUs for 2020/21 onwards — every later year is corrected with an earlier-year FPS instead. Because corrections can only go back 6 years, in practice all corrections now use the FPS method.
Further Reading
- Full Payment Submission (FPS) — the standard submission for current-year reporting
- Final FPS & Year-End Returns — closing the year before EYUs become necessary
- Payroll Year-End Checklist — preventing errors at year end
Looking for simple Payroll software?
#GoFile is HMRC-recognised and trusted by 50,000+ UK businesses. Set up in minutes, file with confidence.
Get Started For FreeNo credit card required · Cancel anytime