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Pay reference period (PRP)

A pay reference period (PRP) is the period of time that earnings and contributions are measured for automatic enrolment purposes.

The length of a PRP is simply the time between pay dates, for example, weekly or monthly. However, as Sage 50cloud Payroll and Sage Instant Payroll use PRPs aligned to tax periods, when it starts and ends is determined by the tax calendar. This tax year, a tax week starts on a Friday and ends on a Thursday. Tax months run from the 6th of a month and ends on the 5th of the following month.

When you set up your pension scheme with your provider, you must advise them that your PRPs are aligned to tax periods. To help you determine your PRPs, use the table below:

Pay frequency PRP Examples
Monthly Must align to the tax month. If your pay date is 25 November, this falls into tax month 8, so the PRP is 6 November to 5 December.
Weekly Must align to the tax week that the pay date falls into and starts on the first day of that tax week. If your pay date is 27 November, this falls into tax week 34, so the PRP is 23 November to 29 November.
Two weekly Must align to the two consecutive tax weeks that the pay date falls into. It starts on the first day of the first tax week and ends on the last day of the second tax week. If your pay date is 19 November, this falls into the tax period weeks 33 and 34, so the PRP is 16 November to 29 November.
Four weekly Must align to the four consecutive tax weeks that the pay date falls into. It starts on the first day of the first tax week and ends on the last day of the fourth tax week. If your pay date is 26 November, this falls into the tax period weeks 33 to 36, so the PRP is 16 November to 13 December.

You can download the The Pension Regulator’s PRP calendars.

If your PRP is aligned to tax months, it’s common for the first pension deduction to be higher than you expect. This is because all staging dates are on the first day of the month and a tax month runs from the 6th to the 5th of the following month. This means the first pension deduction is for one month and five days rather than just for one month.

For further information on pay reference periods, please consult with your pension provider.

Read more about automatic enrolment >>

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