PAYE Health Checks in Nottingham

Payroll

What is Payroll?

Payroll is the compensation a business must pay to its employees for a set period or on a given date. It is usually managed by the accounting or human resources department of a company. Small-business payrolls may be handled directly by the owner or an associate.

PAYE health check

What is a PAYE Health Check?

A PAYE health check is where an employer asks a third party, often an accountancy firm providing tax advisory services, to under-take a review of an employer’s payroll and benefit procedures to ensure that they are delivering the right results in terms of compliance with HMRC’s rules on tax and NIC on employees’ pay, expenses and benefits. It is designed to minimise the risk of interest and penalties and to improve compliance.

Summary findings of a PAYE Health Check

We are able to produce a final detailed report, which would summarise the actions you need to take. The report would highlight both the risks and opportunities. The health check might mean disclosure is needed to HMRC, but as previously mentioned doing this might help to mitigate and reduce any penalties.

Benefits of a PAYE Health Check

Why should you consider a PAYE Health Check?

Image for Peace of Mind

Peace of Mind

it will provide peace of mind for an organisation if it is fully compliant and, if it is not, it is better to know so it can take steps to remedy any problems.

Image of Decrease Penalties

Decrease Penalties

if an organisation knows things are wrong and does nothing about it, and HMRC discovers the failure, the organisation will be deemed to be careless, increasing the potential level of penalty. It is better to take the initiative.

Image for Reduce Disruption Cost

Reduce Disruption Cost

a voluntary disclosure can be made to HMRC of any failures discovered during the review. This may prevent HMRC from carrying out an Employer Compliance Review and the disruption and cost this might cause for the business.

Image for Protect Against Employee Fraud

Protect Against Employee Fraud

to protect an organisation against employee fraud. A detailed review could identify areas of risk.

Image for Employer Compliance Reviews

Employer Compliance Reviews

HMRC assesses the level of risk at an organisation when deciding whether or not to carry out an Employer Compliance Review. 

Image for Keep Up To Date With Legislative

Keep Up To Date With Legislative Chnages

it is important to keep up to date with legislative changes to ensure full compliance.

How can Seagrave French help you?

How can Seagrave French help you?

Our PAYE health check service is designed to find any PAYE issues before the Taxman does!

Why not call us in prior to any visit?

The health check can…

  • Review and sample check your payroll records for errors
  • Sample test the most common errors that the PAYE inspectors look for
  • Statistically analyse your completed PAYE returns
  • Sample check the completion of PAYE returns
  • Compare your PAYE returns against your annual accounts
  • Sample check leavers and starters to make sure they are correctly dealt with
  • Review statutory maternity pay, statutory sick pay, student loan deductions and working tax credits
  • Identify any workers where status issues may be a concern
  • Check completion of end of year returns
  • Review benefit in kind and expenses disclosures and calculations
  • Check expenses dispensations
  • Identify any PAYE planning opportunities

We can also provide a similar service in respect of a CIS health check for the construction industry.

Seagrave French

PAYE system in Payroll

In Nottingham, as in the rest of the UK, the PAYE (Pay As You Earn) system is used in payroll to calculate and deduct income tax and National Insurance contributions from employees’ salaries. The amount of tax deducted is based on the total taxable income of each employee, which includes not only their basic salary but also any bonuses, commissions, or other taxable benefits. It is important for employers in Nottingham to accurately calculate their employees’ total taxable income and ensure that the correct amount of tax is deducted through the PAYE system to avoid penalties and fines from HM Revenue and Customs. By using the PAYE system in payroll and calculating total taxable income correctly, employers can ensure compliance with tax laws and regulations while also providing their employees with clear and accurate payslips that detail their earnings and deductions.

Knowing an individual’s total taxable income is crucial in order to calculate their income tax liability accurately. This is because income tax is levied on all income an individual receives that is above a certain tax-free allowance, which varies depending on the individual’s circumstances. Failing to accurately calculate total taxable income can result in an individual either underpaying or overpaying their income tax, which can lead to penalties or fines from HM Revenue and Customs.

Total Taxable Income

Total taxable income is the sum of all income an individual receives during a tax year that is subject to income tax. This includes not only their regular salary or wages, but also any additional income from other sources, such as rental properties, dividends, or investments. In the UK, the amount of income tax an individual owes is based on their total taxable income, and is calculated according to a set of income tax bands and rates. Deductions, such as personal allowances or pension contributions, may also be applied to an individual’s total taxable income to reduce their overall tax liability. It is important to accurately calculate total taxable income in order to ensure compliance with tax laws and regulations and avoid penalties or fines from HM Revenue and Customs.

Additionally, total taxable income is also important in determining an individual’s eligibility for certain tax credits, benefits or allowances. For example, some tax credits, such as Working Tax Credit, are based on an individual’s income, and may be reduced or eliminated if their income exceeds a certain threshold. Similarly, some benefits or allowances, such as Child Benefit, may be means-tested, and may be affected by an individual’s total taxable income.

Why choose our PAYE Health Check Services?

Our PAYE health check services are designed to help businesses ensure that they are accurately calculating and reporting their employees’ tax liabilities. This includes reviewing total taxable income for each employee to ensure that all sources of income are properly accounted for and that the correct amount of tax is being deducted.

By conducting a PAYE health check, businesses can identify any potential errors or discrepancies in their payroll system including employees’ total taxable income that could lead to incorrect tax calculations or underpayment of tax. This can help to prevent penalties or fines from HM Revenue and Customs and ensure compliance with tax laws and regulations.

Additionally, a PAYE health check can also help businesses to identify any opportunities for tax savings or improvements in their payroll processes. By reviewing total taxable income, businesses may be able to identify areas where tax deductions or allowances could be applied to reduce their overall tax liability. This can help to improve their bottom line and ensure that they are maximizing their tax efficiency.

Overall, our PAYE health check services can provide peace of mind for businesses by ensuring that their payroll system is accurate, compliant and efficient, and that total taxable income is properly accounted for.

Seagrave French

PAYE System in Tax

In Nottingham, the PAYE (Pay As You Earn) system is also used in tax to calculate an individual’s gross pay and net pay. Gross pay is the total amount of an individual’s earnings before any deductions, such as tax and National Insurance, are made. Net pay, on the other hand, is the amount of an individual’s earnings after these deductions have been made. The PAYE system in tax ensures that the correct amount of tax and National Insurance is deducted from an individual’s gross pay, resulting in their net pay. By accurately calculating gross pay and net pay using the PAYE system, individuals in Nottingham can ensure that they are paying the correct amount of tax and that they are not subject to penalties or fines from HM Revenue and Customs.

Knowing the gross pay and net pay is important for both employers and employees. Gross pay refers to the total amount of money an employee earns before any deductions, while net pay is the amount of money an employee takes home after all deductions have been made.

Additionally, gross pay and net pay are important for tax purposes. Income tax is calculated based on an individual’s gross pay, while National Insurance contributions and pension contributions are deducted from the gross pay to arrive at the net pay. Understanding these figures can help individuals plan for their tax liabilities and ensure they are paying the correct amount of tax.

Accurate calculation of gross pay and net pay helps ensure compliance with tax laws and regulations, which can help prevent penalties or legal issues that may arise from incorrect payroll calculations.

Gross Pay and Net Pay

Gross pay refers to the total amount of money an employee earns before any deductions are made. This includes their regular salary or hourly rate, as well as any bonuses, overtime pay, or other forms of compensation.

Net pay, on the other hand, is the amount of money an employee takes home after all deductions have been made from their gross pay. This includes deductions such as income tax, National Insurance contributions, and any other payroll deductions or benefits.

In essence, gross pay is the total amount of money earned by an employee, while net pay is the amount of money actually received by the employee after all deductions have been made.

For employers, understanding gross pay and net payis important for determining how much they need to pay their employees, as well as for calculating the employer’s National Insurance contributions. Accurately calculating gross pay and net pay ensures that employees receive the correct amount of compensation for their work, and that employers remain compliant with employment laws and regulations.

For employees, knowing their gross pay and net pay is important for understanding their compensation and being able to plan their finances accordingly. Understanding gross pay and net pay can help employees negotiate their salary and ensure they are being paid fairly for their work. Knowing their gross pay and net pay, helps employees understand how much money they will actually take home after all taxes, pension contributions, and other deductions have been made.

Why choouse our PAYE Health Check Services?

Our PAYE health check services are essential for ensuring that employers are accurately calculating and withholding the correct amount of taxes from their employees’ paychecks. This is especially important when it comes to gross pay and net pay calculations. By conducting a health check, our team can help employers identify any issues with their payroll processes and make necessary adjustments to ensure compliance with tax laws and regulations.

One of the most important aspects of our PAYE health check services is our ability to review gross pay and net pay calculations. We can ensure that all forms of compensation, such as bonuses or overtime pay, are being properly accounted for in gross pay calculations. Additionally, we can review all payroll deductions and benefits to ensure that net pay calculations are accurate and in compliance with tax laws.

Knowing the exact amount of gross pay and net pay allows employees to better plan their finances, such as creating a budget or saving for retirement.

By using our PAYE health check services, employers can have peace of mind knowing that their payroll processes are accurate and in compliance with tax laws and regulations. This can help prevent potential penalties or legal issues that may arise from incorrect payroll calculations. Ultimately, our goal is to help employers save time and money by streamlining their payroll processes and ensuring compliance with all relevant tax laws and regulations, including those related to gross pay and net pay calculations.

Seagrave French Chartered Accountants

Need our help? We'll get in touch!

Just add your details to the form and we'll be in touch very soon to discuss how we can help you and your business.

Thank you, we'll be in touch!