What every employer needs to know
Employing somebody comes with a lot of responsibilities.
You, as an employer, are obliged to calculate and collect tax, National Insurance and pension contributions on behalf of your employees as well as pay your own share into their pension pot and National Insurance bill.
The tax year runs from 6 April and is divided into tax months. There are important dates each month by which you need to complete certain tasks. It is crucial that you don’t miss those to avoid being fined. Read our guide to key payroll tasks and deadlines to make sure you meet your statutory requirements or… you can always let us handle it for you, just contact us.
– Monthly Tasks
Every time you pay your staff:
- Record their pay – this includes the salary/wages and any other pay.
- Calculate deductions such as tax and National Insurance.
- Calculate the employer’s National Insurance contribution due on your employees’ earnings above current Secondary Threshold.
- Produce and redistribute payslips for each employee.
- Report their pay and deductions in a Full Payment Submission (FPS). Under RTI (Real Time Information) the information has to be reported on or before payday.
In the next tax month
You can view your bill from Full Payment Submission online from the 12th.
- Send an Employer Payment Summary (EPS) by the 19th to claim any reduction on what you owe.
- Pay HMRC by the 22nd.
Employer Payment Summary
Send an Employer Payment Summary (EPS) as well as a Full Payment Submission (FPS) to:
- reclaim statutory payments such as maternity pay
- claim the Employment Allowance
- reclaim CIS deductions as a limited company
Don’t send FPS if you haven’t paid anybody in a tax month – send an EPS instead.
A deadline for sending an EPS is the 19th of the following tax month.
Annual reporting and tasks:
Send final FPS on or before last payday of the tax year (5 April).
Update payroll records
- identify the correct tax code to use in the new tax year
- update your payroll software
Issue employees with a P60
Give a P60 to all employees who worked for you on the last day of the tax year.
You must do it by 31 May.
Report expenses and benefits
If you provided your employees with benefits and expenses, you need to send P11D and P11D(b) forms at the end of the year. The deadline is 6 July. By this date you also need to provide your employees with a copy of the information sent to HMRC.
If you register before the tax year starts, you can avoid having to send P11D forms – you can simply collect tax due on benefits through your payroll. You still have to complete P11D(b) though.
Pay Class 1A National Insurance due on expenses and benefits by 22 July.
If you have any questions, or are considering outsourcing payroll – contact us.
We can help you meet your statutory requirements for a low, monthly fee.