Payroll Compliance: Our advice for a smoother process
Did you know that we have our own in-house payroll bureau here at Fiander Tovell? Yes, that’s right, FTPay is on hand to assist companies with the maintenance of their payroll, help them to meet statutory obligations, and ensure that their employees are paid in a timely manner. All we need to know is the monthly gross pay of each employee, along with any commissions or adjustments required for that month – then we can do the rest.
Although we take the bulk of the payroll process out of your hands, there are still a few things that you need to stay on top of so that, together, we can remain compliant. But what is it exactly that you need to do? We’ve collated some of our top tips to help employers get the payroll process right.
1. Organisation is key…
A disorganised payroll process will negatively impact the rest of your organisation. Having a game plan in place year-round will help to establish a consistent routine for meeting tax deadlines, submitting timesheets, and making payments.
Similarly, there will be changes throughout the year that are your responsibility to inform your payroll provider about. We will need to know about any changes to your employees’ wages, so that we can make sure they receive the correct payment. For example, if there are any changes to an employee’s pay, due to a pay rise or change in their working hours.
We would also recommend using an audit trail. Should you be subject to an investigation, this will help to protect the integrity of your business. Your payroll software may even have such a functionality installed already. Audit trails allow you to link transactions with the required supporting information, to validate any payments that may otherwise raise concern.
2. Do you know the legislation?
Payroll legislation is always changing, and you need to make sure you’re aware of any updates. In seasonal statements and budgets from HMRC, there are often updates to payroll related legislation. Income Tax, National Minimum Wages and pension allowances are just three things that changed in April 2023, with a knock on effect on your payroll process!
Speaking of pension allowances…
As an employer, you must offer a workplace pension scheme by law, which can be paid into by you, the employee and the government.
You should also automatically enrol employees into the pension scheme, should all of the following apply:
- they’re classed as a ‘worker’
- they’re aged between 22 and State Pension age
- they earn at least £10,000 per year
- they usually work in the UK
If you don’t have to enrol an employee automatically, then they can ask to join the scheme and you cannot refuse. You do not have to contribute, though, if they earn these amounts or less:
- £520 a month
- £120 a week
- £480 over 4 weeks
As part of the company pension scheme, you must:
- pay at least the minimum contributions to the pension scheme on time
- let employees opt out if they ask
- let employees re-join the scheme at least once a year if they have opted out
- enrol employees back in at least every 3 years if you’ve opted out and are still eligible for automotive enrolment.
It’s important that you’re aware of which employees are on your pension scheme, how this impacts their gross pay, and how much you’re required to contribute each month.
3. Do your employees know what’s required of them?
There are certain elements of payroll that may be down to information provided by employees – for example, expenses and overtime. It’s important to not only have rigorous policies in place for expenses and overtime, but also to make sure that your workforce is aware of these. These will hopefully discourage employees from misleading you, and will help to avoid inaccuracies in extra payments.
Similarly, it’s also valuable to have strict deadlines for submitting forms such as expenses and overtime, so that you can then process them in time for month-end payments.
At Fiander Tovell, FTPay wants to help you achieve a smoother payroll process within your company.
If you require any further advice, or would like to enquire about our services, please do not hesitate to get in touch at payroll@fiandertovell.co.uk.
You can find our latest accounting and payroll advice here!
