Payroll is the process by which a business pays it employees. It covers keeping records of payments, paying taxes to HMRC on behalf of the employees and distributing money. It makes sure payments to employees are accurate and ensures that the correct statutory deductions have been made from their salaries.

Payroll is a key area of any business and it’s vital that it is carried out in accordance with current legislation.

Do I Need To Run Payroll?

If you are a limited company, you will need to run payroll for all employees, including yourself and any other directors, as you are classed as employees of the business.

If you are a sole trader or partnership, you aren’t required to run payroll for yourself, but you will need to do it for any employees working for your company.

Whether you’re a limited company, a sole trader, or a partnership, anyone with a contract of employment is usually classed as an employee and payroll must be completed for them.

What’s The Difference Between Payroll and PAYE?

Payroll is the PROCESS of paying your employees. PAYE is the SYSTEM used by used by HM Revenue & Customs to collect Income Tax and National Insurance Contributions (NIC’s).

Pay As Your Earn (PAYE) covers the deductions (or additions) to basic wages. Employers are responsible for making these deductions from paid salaries and paying them to HMRC.

What Is Covered By The Payroll Process?

Payroll collects data for every pay period (usually monthly, but it could be weekly or fortnightly) and puts it all into a payroll software program. Payroll software is the tool used to organise and manipulate the payroll information provided.

Payroll includes information on wages or salaries, holiday payments and the calculation of statutory payments like Maternity, Paternity or Sick Pay (SMP/SPP/SSP) and Apprenticeship Levies.

Payroll allows annual or monthly salaries, piece-of-work payments, weekly rates, daily rates or hourly rates of pay.

Payroll handles bonus payments, tips, commission and one-off ad-hoc payments.

Accurate payroll makes sure you remain compliant with National Minimum Wage levels for all your workers. It obviously covers tax and NIC’s and for some companies it also covers the allocation of Employment Allowance (EA).

The service you sign up for should include all processing fees plus the production of Payslips, P45’s for leavers and Year End P60’s and P11D’s. As an employer you’ll want monthly reports that cover everything you need to know, details of how and when to pay HMRC and salary payments for all your staff.

What Are The Benefits Of Outsourcing Payroll?

One of the easiest ways to make sure you’re payroll compliant, is to outsource it. Getting payroll, and all it entails right, can be a daunting responsibility. Handing it over to an expert supports your growing business, gives you back precious time to concentrate on what you’re good at and confidence that the process is in expert hands.

No need to worry about the fast changing legislation or complicated calculations – it’s all taken care of.

Outsourcing is less stressful, more efficient, it delivers better results and improves employee satisfaction.

Get Support From Our Expert Payroll Team

Great payroll is powered by expert knowledge and efficient software. At Moorgate, we have both in abundance. Say goodbye to spreadsheets and hello to professional looking paperwork for all your employees.

If you would like to speak to us about your Payroll, or if you have a different kind of PAYE question that you’d like advice on, please get in touch. A member of our payroll team would be delighted to get in contact with you and see how we can help you.