Payroll is the system by which companies pay their employees and calculate tax, national insurance and possibly other staff costs such as pensions. If you are a business employing staff, you will need to run payroll.
PAYE (Pay As You Earn) is the way in which HMRC collects income tax and national insurance from employees. Employers must be registered online at www.gov.uk to obtain a PAYE reference number. As a registered employer, you can either set up and run payroll yourself using payroll software or by hiring a payroll provider. Whichever option you take, it is still up to you to ensure employee records are collected and kept, and that you are PAYE compliant.
PAYE periods run from the 6th of each month to the 5th of the following month. It is down to employers to calculate tax, NI contributions and any other deductions then issue payslips. The employer must submit a return to HMRC on or before payday of each month.
Using a payroll system requires a large investment of time. Setting it up, learning how to use it and understanding the legal requirements that change on a yearly (or occasionally more frequent) basis will eat up time. Small companies are generally better off outsourcing payroll to a qualified accountant or payroll professional.
While companies with lone owner/directors do not need to run payroll and can take profits from the company as dividends, it is normally more tax efficient to pay a mixture of salary and dividends.
We offer a comprehensive payroll service. This includes the following:
For a free consultation on how we can support you with payroll and all related queries, get in touch by filling out the form above.
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Aston Black have provided accountancy services to my company, Topcat Metrology Ltd for the last six years. They are efficient, professional and extremely helpful, always going out of their way to ensure that the company’s record keeping is accurate and timely. I would heartily recommend them to other small businesses for payroll, end of year and VAT accounting
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