Who do employers have legal responsibilities to?
HMRC, the relevant tax authority, for their payroll operations
What are employees charged?
Income tax and national insurance contributions on a salary wage as they receive
When paying an employee each payday, the employer must deduct
An amount for the employees income tax and NIC the employee receives only the amount after that
The employees NIC is also deducted are known as
Class one primary contributions
What is class one secondary contributions?
 the employer is also charged NIC on the salaries and wages paid to employees these NIC suffered are known as…
Define class one national insurance contributions
Suffered by employees and employers on the wages and salaries of employees they are paid to HMRC along with payE
What is tax code?
Provided by HMRC for future employee each tax year
When does the tax year run from?
Sixth of April in one year to the 5th of April and the next year
Who’s responsibility is operation of payroll
The employer, these include registering as an employer and keeping records
What must an employer pay regarding payroll?
An external payroll provider, such as a payroll bureau or an accountant to operate payroll on its behalf however the employer remain remains responsible
An employer misregister individuals if any of the following applies
Paid more than £123 a week, has another job, receives a pension, is provided with benefits by the employer
How does a business register employee?
Most register online
What happens for private individuals who employ staff such as cleaners?
Such employees need to telephone HMRC to register
When must an employer register an employee?
Before the first pay date and cannot register more than two months before starting to pay employees
What allowance do employers receive?
To reduce the total employees class one NIC liability
What is the employment allowance for the tax year 24/25?
5000 per an employer
What does the employer pay if the employers liability is less than the allowance?
No class one employers NICs for the year
What can the allowance not be used against?
Other classes of NICs e.g. Class.1a
The employment allowance is not available to:
Companies where director is the sole employee, employers with total class one employers NIC> £100,000 in the previous tax year
What will HMRC issue after an employer has been registered?
An employer pay E reference number – ERN which is used on payroll records and an account office reference used when making payment
What happens when an employer who fails to register?
Will be liable to penalties for failure to report employee payments to HMRC and failure to pay paye used to HMRC
What reasons must an employer keep records relating to employees?
For many reasons, including to comply with employment law
What records must be kept in order to comply with a tax law?
Employees pay before deduction, PAYE deductions, NICs, other deductions, taxable benefits given to employees
How long must details of reports and payments made to HMRC be kept for?
Three years from the end of the tax year to which they relate, HMRC can issue a penalty of £3000 if an employer fails to keep proper records
