Annual Leave Carry Over at Holiday Year End: See Who Keeps and Who Loses Days Before It Closes
In short
Set one carry-over rule per leave type, then check every person's days left, carried and lost before the holiday year ends, not after staff complain.
- gov.uk says the contract sets how many days can carry over, and someone on 28 days can carry over a maximum of 8 (checked on 12 October 2026).
- Staff who could not take leave because of sickness or family leave are treated differently, so a blanket rule needs exceptions.
- In Shiftelio, Close the leave year shows every person's days left, carry forward, lapse and what they start next year with, before the year closes.
To handle annual leave carry over at the end of the holiday year, decide one rule for each leave type (lapse, carry up to a set number of days, or carry everything), then check each person's numbers before the year closes. The check matters more than the rule: it is where you spot the barista who is about to lose four days because nobody reminded her to book them.
Most small UK businesses do the opposite. The year rolls over on 1 January or 1 April, someone asks in February where their days went, and the owner tries to rebuild the sum from a diary.
What happens to unused holiday at the end of the holiday year
The holiday year (gov.uk calls it the leave year) is the 12 months your staff's entitlement runs over. Many cafés and shops use January to December; others match the tax year and run April to March. Whatever days are left on its last day either carry over into the next year or are lost, depending on what the contract says.
That is the decision. The work is doing it the same way for everybody, and seeing the result per person before it happens rather than after.
What gov.uk says about carrying over holiday
This is background to the set-up, not advice on your contracts. Everything below is from gov.uk's calculate leave entitlement page, checked on 12 October 2026. The statute behind it is the Working Time Regulations 1998.
- The contract decides. gov.uk says the worker's contract says how many days' leave they can carry over into the next year.
- 28 days, at most 8 carried. If a worker gets 28 days' leave, gov.uk says they can carry over a maximum of 8 days. If they get more than 28, the employer may allow them to carry over the additional untaken leave.
- Family leave. If a worker cannot take some or all of their leave because they are on family-related leave, such as parental leave, gov.uk says they can carry over the untaken leave.
- Sickness. If a worker could not take their leave because they were sick, gov.uk says they can carry over up to 20 of their 28 days if they work regular hours for the whole year, and up to 28 days if they work irregular hours or for part of the year.
- No chance to take it. gov.uk says workers can carry over their whole entitlement if they were not given reasonable opportunity to take leave, were not told they would lose it at the end of the leave year, or did not receive rolled-up holiday pay they were entitled to.
The last point is the one small businesses trip over. A reminder to book leave, sent while there is still time to book it, is part of the picture, not a courtesy.
This is general information, not legal advice: check with gov.uk, Acas or an employment lawyer for your case.
Choose one rule for each leave type
Every leave type you hold, such as Annual leave or a separate Long service leave, needs one of three year-end rules. In Shiftelio they read exactly like this:
| Unused days lapse | Carry forward up to | Carry forward all | |
|---|---|---|---|
| What happens to days left | All lost on the last day | Kept up to the number you set, the rest lost | All kept |
| Good for | Extra days you give on top of the minimum | Most annual leave in a small team | A small extra allowance you are happy to roll |
| Watch out for | Anyone who could not take leave | Sickness and family leave exceptions | Balances growing year on year |
The rule belongs to the leave type, not to the person, so it is the same for the whole team. That is fair and easy to explain. It also means the exceptions gov.uk describes (sickness, family leave) are the ones you fix by hand afterwards.
Check every person before the year closes
Shiftelio is a staff rota, clocking in and leave app for small businesses. Its year-end screen is called Close the leave year. Open Leaves, then Leave settings, and on the Leave year card tap See the year-end preview. You can open it any time; it is most useful in the last couple of weeks of the year.
At the top: how many People, how many days Carry forward, how many days Lapse, and the date the New year opens. If Lapse is a big number, that is your warning.
The list switches from Everyone to only the people who will lose something. For each person and each leave type it shows Left now, Carry forward, Lapse and what they start next year with.
Under Year-end rules, tap Change a rule, pick Carry forward up to and change the number. The totals and the list change straight away, and nothing is saved until you press Save rules.
Now you know exactly who is losing days. Tell them now, while they can still book the time off. That is the conversation gov.uk's last point is about, and it is far easier in November than in February.
It marks the preview as reviewed with the date. You can still change a rule until the year closes.
On the closing date the new leave year opens on its own with those numbers. Nobody has to remember to press a button on New Year's Eve.
If you got it wrong
For 7 days after the close, Undo year-end reverses the carry forward, the lapse and the new days. It is blocked once someone has already used leave from the new year, and it never touches leave already taken or paid. After that, fix a single person's number with Adjust on their balance, which is also where a sickness or family-leave carry-over goes.
A different leave year for some people
The year runs from the month you choose under When does your leave year start? in Leave settings. If you move from January to April, Shiftelio shows who moves before anything changes, and for each person you choose Carry over what is left or Start again with this year's days. Days already taken never move.
A worked example: a café in York
Hannah runs a café in York with seven staff, a January to December holiday year and Annual leave of 28 days. Her contracts say up to 5 days can carry over, so she sets Annual leave to Carry forward up to 5.
In mid-December she opens Close the leave year and taps Only people losing days. Two names come up:
- Sam has 9 days left now. 5 carry forward, 4 lapse, and he starts 2027 with 33 (28 new plus 5 carried).
- Ellie has 7 left, so 2 would lapse. But Ellie was off sick from September to November and could not take them, so Hannah lets the rule run and then adds the 2 days back with Adjust in January.
Hannah tells Sam on Saturday. He books four days in late December, the Lapse total drops, and nobody loses anything they did not choose to.
Which app shows holiday carry over per person before the year ends?
If you are still setting up holiday from scratch, start with UK holiday entitlement and bank holidays in one go, and see how it fits a UK business on the Shiftelio UK page.
Questions owners ask
Can employees carry over holiday to next year in the UK?
Yes, as far as the contract allows. gov.uk says someone on 28 days can carry over a maximum of 8, and more if the employer allows extra leave above 28 to carry.
Do I have to let staff carry over holiday they could not take because they were off sick?
gov.uk says yes, up to a limit. Workers who could not take leave because of sickness can carry over up to 20 of their 28 days on regular hours, or up to 28 on irregular hours or part-year work.
When does the holiday year start?
Whenever you set it. gov.uk says employers should tell staff the leave year dates when they start; if the contract does not set one, it starts on the first day of the job.
Does Shiftelio close the holiday year automatically?
Yes. The new leave year opens on its own on its date with the numbers the preview showed, and you can undo it for 7 days if nobody has used new-year leave yet.
Can I change the carry-over rule after checking the preview?
Yes. Change a rule, watch the totals update, then press Save rules. Nothing changes until you save, and you can keep editing until the year closes.