What do I do if I want to employ someone?
You must register immediately with HMRC as an employer. You will need to deduct PAYE and National Insurance from your employee’s salary at prescribed rates. If you do not do so, or make incorrect submissions to HMRC then you can be liable to heavy penalties and interest on tax and NIC that you do not pay over. You will also need to disclose and pay NIC on employee benefits that you provide to your employee.
I employ staff, what are the current National Minimum Wage rates?
From 1st October 2012 you should pay at least-
- £3.68 per hour to those under 18 who are no longer of compulsory school age.
- £4.98 for those aged 18 to 20, and
- £6.19 to employees aged 21 and above.
- Apprentice £2.65
From 1st October 2013 you should pay at least-
- £3.72 per hour to those under 18 who are no longer of compulsory school age.
- £5.03 for those aged 18 to 20, and/li>
- £6.31 to employees aged 21 and above.
- Apprentice £2.68
Expect the rates to go up again in the future.
How do I pay myself?
If you are a director/shareholder of a limited company then you can pay yourself by means of a salary or by declaring a dividend which is paid to shareholders out of its profits. Advice needs to be taken about the best way to do this. After due consideration of your particular circumstances, we can advise you on the most tax efficient means of extracting profits from the company.
If, on the other hand you are a sole proprietor or partner, the wages and salaries you pay to your employees are deducted in arriving at the profits on which you are assessed to income tax. It is important to understand that what- ever you may draw out of the business on a weekly/monthly basis to meet personal living costs is NOT a wage/salary in these circumstances.
How do I know how much PAYE to pay?
As we run a payroll service, we can prepare the necessary details for filing under RTI and we will of course advise you of any PAYE liability due and when payable.
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