Navigating the world of UK payroll can feel like learning a new language. Between PAYE, NICs, and RTI, the sheer number of acronyms is enough to make any business owner’s head spin. But there are two that stand above all others in terms of importance and risk: FPS and EPS.Confusing a Full Payment Submission (FPS) with an Employer Payment Summary (EPS) isn’t just an administrative slip-up. It’s a costly mistake that can lead to immediate HMRC penalties, a loss of cash flow, and a major compliance headache.
These two submissions are the cornerstone of the Real Time Information (RTI) system, and understanding the distinct role each one plays is non-negotiable. Let’s break it down in simple terms.
The FPS (Full Payment Submission): Your Core Reporting Duty
Think of the FPS as your primary, most frequent communication with HMRC. It is the digital report you must send every single time you pay your employees.
What It Contains: The FPS details everything about your employees’ pay and deductions for that specific pay period—their gross pay, income tax, National Insurance contributions, student loan deductions, and more.
Why It’s Critical: This is how HMRC knows how much tax and National Insurance is due from your company. The deadline is absolute: the FPS must be sent to HMRC on or before your employees’ payday. There is no grace period. A late submission, even by a day, automatically triggers a penalty notice. Consistent late filings are a major red flag that invites further HMRC scrutiny.
The Accelus Solution: We guarantee that a correct and compliant FPS is submitted for every employee on every pay run, without fail. We eliminate the risk of late filing penalties and ensure your core reporting duty to HMRC is always met.
The EPS (Employer Payment Summary): Your Tool for Reclaiming Cash
If the FPS is what you report, the EPS is what you reclaim. This submission is used to inform HMRC of any reductions you are entitled to make to the tax and National Insurance bill you owe them.
What It’s For: Did you pay an employee Statutory Maternity Pay (SMP), Paternity Pay, or Adoption Pay? You can typically reclaim some or all of this from HMRC. Are you eligible for the Employment Allowance or relief under the Construction Industry Scheme (CIS)? The EPS is how you claim it.
Why It’s a Costly Mistake to Miss: Forgetting to file an EPS when you’re eligible is like leaving cash on the table. You simply end up overpaying HMRC and squeezing your own cash flow for no reason. Unlike the FPS, which is always required, the EPS is only sent when you have something to reclaim or report.
The Accelus Solution: We don’t just process payroll; we optimize it. Our experts proactively identify every opportunity to use the EPS to reclaim money your business is owed. We ensure you never overpay HMRC, turning a compliance task into a cash flow benefit.
The High Cost of Getting It Wrong
The two submissions create a dual risk that can trap any business:
- A late FPS costs you money in penalties.
- A forgotten EPS costs you money in overpayments.
Managing both flawlessly is the key to a healthy and efficient payroll system. It requires a deep understanding of the rules and a process that is both disciplined and proactive.At Accelus, we manage this entire ecosystem for you. We handle the timely FPS submissions to ensure you are always compliant, while simultaneously using the EPS to ensure you are always tax-efficient. It’s a complete, managed service that removes the risk and the worry.
Perfect UK Payroll. Every Time.
Stop letting payroll acronyms create stress and financial risk in your business. With an expert partner, you can be confident that your reporting is flawless, your payments are optimized, and your compliance is guaranteed.Let us handle the complexity of FPS and EPS, so you can focus on what you do best: running your business.
Ready to stop worrying about payroll?
Let’s talk about how we can build a seamless, compliant system for you. Get in touch with AccelUS!