For companies that have an obligation to operate Pay As You Earn (PAYE), we have put together an easy-to-follow guide with what’s required to register with HMRC.
1. How to register with HMRC
A company can register a PAYE scheme through the official HMRC online application form. In there, you can add up to 9 directors and at least one director needs to have a national insurance number. Where a company does not meet these criteria, it will need to call HMRC’s employer helpline on +44 (0) 300 200 3211 to set up the payroll scheme over the phone.
Information required to register
Before applying to register the PAYE scheme, a company will need to collate the following the information:
- Full legal name of the company
- A trading name for the company if different to the full legal name
- If registered at Companies House, the company registration number
- The trading address for the company
- A correspondence address for PAYE purposes (if different to the trading address, such as a payroll agent’s address).
- For UK companies, a Company Unique Tax Reference (used for Corporation Tax purposes)
- A name of one the company’s directors
- The same Director’s national insurance number (if applicable).
- The type of business activities carried out by the Company.
- A contact number for the company
- A contact email address for the company.
When can the company start its registration process?
Companies can register a payroll scheme up to two months before the first hire earning more than the Lower Earnings Limit.
How long can the registration process take?
HMRC aims to review all online registrations within 7 days of the online application. When registering over the phone, the PAYE scheme will be created by the end of the call.
When will the company receive the PAYE references from HMRC?
HMRC will issue the PAYE reference (identifying the PAYE scheme) and an Accounts Office Reference (used to allocate payments sent to HMRC) in the post. From making the application, a response is usually received within 7 days of making the application, but timing can vary depending on HMRC’s processing backlog and any postal delays by Royal Mail.
2. Ongoing compliance after Payroll registration
Once the company has received the PAYE references from HMRC, it needs to inform HMRC of the employees joining the payroll scheme and report the payments and withholdings to those employees.
Full Payment Submission (FPS)
The company must make a FPS each month to HMRC on or before the pay date. Payment of any income tax and national insurance contribution withholdings must be received by HMRC no later than 22nd of the month following the relevant pay period.
A final FPS must also be made at the end of the UK tax year ending 5 April to confirm the final payment submission for that year.
Employment payment summary (EPS)
An EPS must be submitted for any periods where:
- Claiming the employment allowance – available if de minimis state aid rules do not apply and the company or the group pays less than £100,000 employer’s national insurance contributions in the previous tax year and another group claim is not already claiming the allowance – normally in the month the payroll was first registered and the start of each tax year where the allowance is available.
- No employees or directors are paid.
- A reduction in PAYE is required for the company to recover or claim compensation for certain payments to employees is made such as Maternity, Paternity or Statutory Sick Pay
- An increase in PAYE is required to pay the Apprenticeship Levy.
The deadline to submit an FPS is the 19th of the month following the relevant pay period.
3. Information to report about employees
Information that must be reported to HMRC as part of the FPS is:
- Their name
- Their gender
- Full address
- National Insurance number
- Start date
- Student loan or postgraduate loan information
- Their previous tax code or if this is not known, an emergency tax code.
- If available, the income and income tax the employee has received from any previous employments in the current tax year.
The above information is available from a form P45, issued by the employee’s previous employer, or if one is unavailable from the employee completing a new starter checklist issued by HMRC (or equivalent).
How we can help
At Abbiss Cadres we offer payroll services as part of our multi-disciplinary offering to help businesses move and manage their people. This includes assessment of a company’s payroll obligations in the UK and, if required, set up and operation of UK payroll.
We can also provide more detailed technical advice on whether a UK tax presence has been created. For more information about how we can help, please contact us on the details below.
