If you're intending to employ people, or even pay yourself a salary, your company will need to register for PAYE with HMRC so that any deductions, such as tax or National Insurance can be declared and paid.
PAYE, or Pay as you earn is a system, operated by HMRC, for deducting tax and National Insurance contributions from yours, or your employee wages.
If you need to employ staff within your company, even if that's you, you will probably need to pay wages for the work they've done.
PAYE is HMRC's system for collecting income tax and National Insurance contributions from those wages.
As an employer, you will calculate and collect PAYE from all your staff wages at the appropriate rates on a weekly or monthly basis. Then, each month, you calculate the total amount deducted from all wages and pay this to HMRC.
To aide in calculating the PAYE deducted, you will need to purchase a payroll software and this will be used to calculate and declare what deductions need to be made.
First, our expert accounting consultants will provide advice and support to you on PAYE. If applicable, we'll complete the forms and submit them to HMRC electronically.
Once submitted, HMRC will carry out some tests on the information provided. Typically, the application is processed within 10 working days and a PAYE reference number is issues.
Once you start paying salaries, you will calculate what deductions are needed for each payment and pay the difference to the employee.
Typically, each month, you will calculate how much PAYE has been deducted in that month and a declaration is submitted followed by a payment to HMRC.
We can provide a PAYE number for your new company and advise on how to operate payroll
Before registration, you get access to an accountancy consultation that will allow you to discuss your PAYE options.
If PAYE registration is applicable, we'll prepare and submit your PAYE registration application to HMRC.
Normally, within 10 working days, HMRC will process the application and we'll send your PAYE numbers to you.
*free of charge on the professional and all-inclusive package
Questions about our PAYE registration service
You only need to register for PAYE if you intend to start employing people, or you wish to start paying yourself a salary from the company.
In most cases, it will take around 10 working days to receive your PAYE reference numbers from HMRC. However, if HMRC need more information about the business, this might extend the lead time.
If you plan to manage the payroll for your employees yourself, we recommend investing in payroll software to manage the deductions as they can be quite complicated. Alternatively, our expert accounting partner, Clever Accounts, can help. Ask for more information here.
The level at which you deduct PAYE from an employee will vary and is dependent on the amount earned and their tax code. Using suitable software, or outsourcing the payroll function will ensure you calculate the PAYE correctly.
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