PAYE Services Leicester

PAYE or Pay As You Earn is HM Revenue and Customs’ system to collect the payment of Income Tax and National Insurance from employment.

Employees who are paid via Payroll will invariably be subject to PAYE deductions such as Income Tax, National Insurance, Pension Contributions and Student Loan payments at source. This means that the Employer is responsible for ensuring these deductions are paid directly to HMRC on the Employee’s behalf as part of the Payroll calculations before the Employee receives their net pay (the amount they receive after all deductions have been made).

As an Employer running your own Payroll, as well as completing all necessary calculations you will need to complete regular Employer Intermediary reports and declare all Employee PAYE payments and deductions to HMRC. As part of this regular reporting, you should also inform HMRC of any significant changes to the Payroll such as when an Employee joins/leaves, or inform of any changes in circumstance such as when an Employee becomes a Director or reaches State Pensionable age - PAYE is also used to collect Income Tax from the Pension income of those individuals who continue to work…..

It’s not all doom and gloom though as not all earnings are liable to Income Tax.

For example you won’t necessarily pay Income Tax on mileage allowance up to HMRC approved rates if you use your own car for work. Certain payments for extra household costs can also be Tax Free if you regularly work from home by arrangement with your Employer. There are also certain Lump Sums such as Armed Forces pension gratuities and certain injury compensations resulting in you being unable to work which are also Tax Free so feel free to give us a call if you are unsure whether payments applicable to you attract Income Tax or are Tax Free.

We Can Help With PAYE

The above is only meant to be a very brief overview of the PAYE system but if you have any specific questions regarding your PAYE concerns or you would like Barnstone Accountancy to help with any PAYE related issues then please feel free to contact us by either pressing the “Contact Us” button or via the contact details listed below.

No fuss, jargon free and easy to understand