UK Payroll Guide
Having the right payroll system is imperative to ensure you are paying your staff accurately, on time, and in-keeping with the law. The law states how things like national insurance must be deducted, how payslips are issued, and records kept/returns to the tax man. These things all come under ‘payroll’ and must be taken care of for the million or so UK businesses that employ staff.
There are all kinds of options for sorting your payroll. A simple system can ensure one employee is paid the same each month, while a more complex system can pay multiple members of staff different amounts every week. It will also take into account staff who are leaving and being brought onboard.
How can you ensure your payroll is taken care of in-keeping with the law? There are a few options in this UK payroll guide.
Outsourcing Your Payroll
Outsourcing your payroll can be done with the help of an accountant or book keeper. If you are a larger business, you may choose to work with a special payroll services firm. However, good communication is a must – you must make it known when somebody leaves, or they may still get paid. This option should always be measured against the financial cost and the risk of communication errors, particularly for more complex payroll systems.
Taking Care Of Your Payroll In-House
If you plan on taking care of your payroll in house, you need to make a few important considerations. Who will run it? What tools will they use? Sometimes, a director takes care of this task, or larger firms may delegate it to an individual, a team or even a department. Whoever gets this all important job, a knowledge of the PAYE tax system is a must, and the returns must be sent to HMRC.
Using A Payroll System
The majority of returns need to be sent to HMRC electronically, so a computerised payroll system is beneficial and makes a lot of sense for the majority of businesses. A good system will do the necessary calculations, produce payslips, send returns to HMRC, and print P45, P60 and other important documents for employees. It can also take care of calculations like sick pay, maternity pay, and so on.
You may install a package on your PC, or use an online-based system. The more basic of packages may mean you have to use the same computer each time, which can be a hindrance as it must always be backed up. An online system will store the important data remotely so you can access it wherever you may be.
Conclusion: What Should You Do About Your Payroll?
The rules are always changing – so keeping an up-to-date system, however you choose to take care of your payroll, is a must. The majority of software packages will need to be upgraded on a yearly basis, but this usually won’t cost extra.
How you decide to manage this aspect of your business is an important choice, as it can reduce much stress and embarrassment later on down the line.