Like it or not if you are going to employ staff Payroll is something you are going to be faced with, how you deal with it is up to you, you may opt for the DIY route or you may use the services of a professional.
This bite sized guide is for those of you who are opting for the Do It Yourself route.
If you are thinking of taking someone on first take a look at the Prospective Employer’s Pack from the Revenue.
If you know you are going to take someone on then you should register as an employer before you do so. To register contact the New Employers Help line and one of the operators will talk you though the registration process, it really is a painless experience.
The New Employers Help line operator will need some general information from you in order to get you registered as an employer, to make things easier have it at hand. This information is:
- Business Name
- Trading Address
- Name and address of employer
- National Insurance number and Unique Taxpayer Reference of employer
- Contact telephone number
- Contact email address if registering using email
- Nature of business
About your employees
- The date you took on (or will be taking on) your first employee(s)
- How many employees you will have
- The date you intend to pay them for the first time
- How often you intend to pay them
About your payroll
- The address from which your payroll is run
- The name, address and telephone number of anybody who looks after your payroll
Simplified Deduction Schemes only
- Name, address including postcode of each employee
- Date of birth and National Insurance number of each employee
- Nature of employment for each employee
- Names and addresses of any business partners
- National Insurance number and Unique Taxpayer Reference of any business partners
- If you are a Limited Liability Partnership (LLP) you must provide your LLP number.
Limited companies only
- The company’s Registered Office, Company Registration Number and the date of incorporation.
- The names, addresses, private telephone numbers, National Insurance number and Unique Taxpayer Reference of the company directors.
Once registered you will then be able to operate the Payroll for all your staff. As a new employer you will receive a New Employers Starter Pack which will contain guidance on operating PAYE, National Insurance, Statutory Sick Pay and Statutory Maternity Pay.
But how do I calculate my employees net pay?
It’s only possible to give you an outline, as the running of a payroll system is a complex area.
To calculate the amount of tax and national insurance due by an employee, the Revenue will supply you with sets of tables. By reference to the pay adjustment tables and your employee’s tax code you will be able to calculate the amount of salary that is not subject to tax. The difference between this figure and the gross amount is the employee’s taxable pay. By reference to another set of tables called the taxable pay tables the tax can then be calculated on this taxable pay. The employer’s and employee’s national insurance is calculated by reference to the gross pay with a third set of tables.
Note: The tax and national insurance should be paid to the Inland Revenue by the 19th of the month following that in which the salaries were paid.
The above is only a bite sized guide, but I hope you find the links useful, and if you are going to try the DIY route the Revenue run training days at various centres around the country, try phoning your local office for details on the next one in your area.