Small Business Accounting

How do I pay an employee?

By

Chris Andreou

How do I pay an employee? guide

Contents

If you're paying an employee for the first time, you'll need to set up payroll. You need to take the following steps:

  1. Register as an employer with HM Revenue and Customs (HMRC) and get a login for PAYE Online.
  2. Choose payroll software to record employee's details, calculate pay and deductions, and report to HMRC.
  3. Collect and keep records.
  4. Tell HMRC about your employees.
  5. Record pay, make deductions and report to HMRC on or before the first payday.
  6. Pay HMRC the tax and National Insurance you owe.

<p>If you're paying an employee for the first time, you'll need to set up payroll. You need to take the following steps:<br></p><ol><li><a href="https://www.gov.uk/register-employer" target="_blank">Register as an employer</a> with HM Revenue and Customs (HMRC) and get a login for <a href="https://www.gov.uk/paye-online" target="_blank">PAYE Online</a>.</li><li><a href="https://www.gov.uk/payroll-software" target="_blank">Choose payroll software</a> to record employee's details, calculate pay and deductions, and report to HMRC.</li><li><a href="https://www.gov.uk/paye-for-employers/keeping-records" target="_blank">Collect and keep records</a>.</li><li><a href="https://www.gov.uk/new-employee/" target="_blank">Tell HMRC about your employees</a>.</li><li><a href="https://www.gov.uk/running-payroll/" target="_blank">Record pay, make deductions and report to HMRC</a> on or before the first payday.</li><li><a href="https://www.gov.uk/running-payroll/paying-hmrc" target="_blank">Pay HMRC</a> the tax and National Insurance you owe.<br></li></ol>

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