If a tax code isn't updating in UK Payroll, it's usually caused by missing employee data or HMRC notice preferences. This article walks through the most common causes and how to resolve them.
One of the most common reasons is that the employee record is missing a National Insurance (NI) number. Without an NI number, HMRC can't match the employee to any P6 or P9 tax code notices, so the updated tax code won't be received.
To check where the NI number is mapped in HiBob:
Go to Payroll > Settings > Bob.
Scroll down to Sync Configuration.
Check which Bob field is mapped to the employee's National Insurance number.
Add the employee's NI number to the corresponding field in Bob.
Once the NI number has been added:
Go to Payroll > Employees.
Select the employee.
Click Actions > Sync Now.
The sync will pull the latest employee information into Payroll and allow HMRC notices to be matched correctly.
Another possible cause is that the company's HMRC account is configured to receive tax code notices by post rather than electronically. In this case, HMRC won't send P6 and P9 notices directly to Payroll.
To update the HMRC notification preferences:
Log in to your HMRC account.
Under PAYE for Employees, select View tax codes or notices and set up alerts.
Under Notice Preferences, select Change how you get tax codes and student loan notices.
Change the relevant options to Yes.
Click Next and then Submit.
It can take up to 24 hours for HMRC to apply the change.
If the tax codes need to be updated immediately, you can manually import them while waiting for the HMRC update to be processed:
In UK Payroll, go to Employees.
Click Import/Export in the top-right corner.
Select Import Tax Codes.
Click Import Data Manually.
Enter the employee ID and the required tax code.
Click Confirm.
To review tax code updates received from HMRC:
Go to Payroll > HMRC Documents > Employee Updates from HMRC.
Adjust the date range as needed.
Select Tax Codes to view a summary of the P6 and P9 notices received from HMRC.