What to do when an employee reaches State Pension age
You need to update your payroll records when one of your employees reaches State Pension age so they stop paying National Insurance.
Reporting and paying
Change their National Insurance category letter to 鈥楥鈥� in your payroll software - this means you鈥檒l stop deducting National Insurance from their pay. You still need to pay employer鈥檚 contributions for them.
Carry on reporting year-to-date information under the old category letter until the end of the tax year.
If you鈥檙e paying a company pension to an employee who鈥檚 retiring, you need to report specific things to HM Revenue and Customs (HMRC) in your Full Payment Submission (FPS).
Getting proof
Your employee needs to show you one of the following to prove they鈥檝e reached State Pension age:
- birth certificate
- passport
- a certificate of age exception (CA4140), if they鈥檝e already got one
CA4140 certificates are no longer being issued.