Payroll Services (PAYE)

Payroll Services & Auto-Enrolment Pensions
Your Questions Answered

What does PAYE Mean?

PAYE ‘Pay as You Earn’ is a payroll system overseen by HM Revenue and Customs which deducts income tax, national insurance contributions and student loan deductions in accordance with PAYE codes and rules.

Does every business need to have a PAYE scheme?

No. Only businesses that have employees need to have a PAYE scheme in place. Employees are individuals who work for you for an agreed rate. Workers do not need to work full time to be considered employees, they simply are people paid to work.

How do you obtain a PAYE Reference?

An application process using HM Revenue and Customs online services is used for generating a scheme. Once the scheme is set up, you are issued with a PAYE Reference and Accounts Office Reference which you then use to submit your payroll data to HMRC.

Do I have to use Payroll software?

Yes. Developments in recent years have seen the introduction of ‘Real-Time Information’ RTI where employers must report details of wages and deductions at the time of paying employees. Employers must then pay over to HMRC the deductions every month on a very strict timescale. Using payroll software helps to minimise the administrative burden and also helps to ensure the correct deductions are taken from the employees’ wages and the correct reports are generated for both the employees and for HMRC.

What is an ‘Auto-Enrolment Pension’?

Auto Enrolment is a recent introduction made by the government to enable workers to save for their retirements through pension schemes. In the past, it has always been up to the worker to decide whether to join an employer’s pension scheme but now employees are automatically enrolled into a pension without the need to be asked. Employees can ‘opt-out of the auto-enrolment pension scheme if they wish.

So as an employer, you have to offer a Pension Scheme for your employees?

Yes. It is compulsory by law now for employers to offer workers a workplace pension. You have to automatically enrol every eligible worker into a scheme. You also have to make contributions as an employer to your employee’s scheme. Regular submissions are needed by employers to the pension company and pension authorities to ensure you are fulfilling your responsibilities as an employer.

What is the best way to keep track of deductions, pension contributions, amounts due to HMRC etc.?

By using RTI compliant software. The software really helps to remove the stress and burden of running your payroll. Weekly, fortnightly, or monthly payrolls can be processed. Payslips are produced via the software so the employees are provided with the legal documentation for their pay. The software can also manage the pension scheme administration. Starters and Leavers are easily processed, and the year-end processes are needed for Payroll e.g., issuing P60’s to employees and year-end submissions to HMRC.

What happens if you choose not to comply with PAYE and Auto-enrolment regulations?

Regardless of the size of nature of your business, it is essential that you comply with all legislation issued. Failure to do so can result in significant fines and penalties issued. The level of fines or penalties issued depends upon the breach and the time involved.

Why choose us?

We have our very own payroll department offering comprehensive payroll services from start to finish. We take the stress of managing your payroll away and provide a worry-free, and confident service which we handle in a very professional and timely manner. Our department operates to your timetable. We provide a secure portal for exchanging payroll data and supplying your employees with electronic payslips and P60’s etc. We submit all requirements to HM Revenue and Customs and advise you of your liabilities needing payment. We upload the pension data to the pension company and complete the pension administration on your behalf. We are on hand for any advice you may need. We understand how important payroll is for every employer and therefore our aim is to remove this burden from you and provide you with our dedicated payroll bureau service.

Why Choose Us - Hollingsworth & Co