payroll services

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14 of Our Most Commonly Asked Payroll Questions: Answered

14 of Our Most Commonly Asked Payroll Questions: Answered 1413 886 Growth Partners

The world of HR and payroll continually changes, leaving many business owners with a multitude of questions.

Luckily, as experts in all things payroll, we’ve answered some of our most commonly asked questions, hopefully shining a light on any issues you may be facing yourself with your own managed payroll.

  1. What form do I need to complete if we stop SSP, but the employee is still off sick?

If you stop SSP when an employee is still off sick, you should complete an SSP1 form and send it to the employee. This will help them claim employment and support allowance.

  1. What is classed as a linked period of sickness?

A linked period of sickness is when an employee has regular periods of sickness that last four or more days each, separated by less than eight weeks, which have lasted for longer than three years. In this case, SSP will stop.

  1. When can I stop paying SSP? 

The maximum amount of SSP is 28 weeks. Additionally, If an employee has had continuous series of linked sickness that has gone on for more than three years, you no longer have to pay them SSP.

  1. What happens to SSP if an employee is off-sick or self-isolating because of COVID-19?

Since 13 March 2020, employers should start paying an employee SSP from the first qualifying day they are off work – if they’re off for at least four days in a row. Employees do not qualify for SSP if they are self-isolating solely because they are entering or returning to the UK after going abroad.

  1. What should I do when an employee’s tax code is wrong?

Usually, for new employees, if they haven’t completed a new starter checklist, their tax code will be wrong.  The new starter checklist is a HMRC form which all employees should complete on their first day of employment.

  1. My employee insists they have paid too much in deductions – what do I do?

Many employees don’t fully understand the payroll legislation for both Tax and NI and when this becomes payable. It is your responsibility to explain the process to them and clearly show them that they have in fact paid the correct amount in deductions.

We provide our clients’ employees with a dedicated customer service team to help explain all pay documents and any deductions over live chat, email or phone.

  1. Why has an employee not been enrolled into the pension automatically? 

Auto-enrolment is based on age and earnings. All employees are automatically enrolled after the 3-month postponement period if they meet the qualifying criteria (age 22 and earn over £10000).

  1. How do I opt an employee out of the pension scheme?  

Under The Pensions Regulator rules, it is up to the employee to complete an opt-out form which they must get directly from the pension provider. You cannot opt an employee out on their behalf.

Please note, rules around SSP and payroll are different for some workers, so you should always refer to the latest advice on GOV.UK.

Transferring your payroll 

  1. Does a transfer of payroll providers need to take place at the start of a tax year?

No, you can transfer payroll providers at any time without any disruption to payroll.  However, depending on who you choose to outsource payroll to, it may cost you more if you choose not to transfer at the start of the tax year. This is because some payroll providers will be required to recreate your whole payroll since the start of the tax year. This will take time and therefore increase your costs.

You can outsource your payroll to Growth Partners at any time of year without disruption to payroll and without any set up costs.

  1. What is a Real Time Information Pay ID?

The RTI Pay ID captures your company’s employee reference. You enter this when you set up a new employee on your payroll. The Full Payment Submission (FPS) must be sent on or before payday and an Employers Payment Summary (EPS) must be submitted by the 19th of the following month to avoid fines from HMRC.

  1. What’s involved in transferring payroll providers?

If you transfer payroll providers at the start of the tax year, employers need to send the new payroll provider a list of all current employee data along with salary details. If you transfer providers at any other time, your payroll provider will require a lot more data from you regarding previous salary payments.

However, you can transfer payroll to Growth Partners as part of SMART Employment model at any time with minimal data.

  1. What’s involved in transferring payroll providers to a PEO model? 

When you are transferring payroll providers and the HMRC liabilities as part of the PEO model, you need to send the new payroll provider a complete list of all current employee data, along with salary details. You also need to ensure employees are set to ‘leavers’ in the old payroll and produce a P45 for each of them. The P45s are not sent out to employees – they are sent to the new payroll provider only.

  1. How long does it take to transfer payroll providers?  

Depending on the size of the business and the complexity of the payroll, it can take between one to two weeks for small to medium businesses, and up to four to six weeks for larger businesses.  Some payroll providers may require longer than this – particularly if you wish to transfer your payroll midway through a tax year.

  1. Do I need to contact HMRC if I change payroll providers?

You do not usually need to contact HMRC if you change payroll providers. However, if you wish to outsource your payroll to specialists like Growth Partners who take on the HMRC responsibilities for you, then you will need to complete a year-end submission.

The year-end submission will confirm to HMRC that you have closed your old PAYE. This is usually done via an EPS submission once you have processed your final payroll. You will also need to confirm the cessation date on the submission.

Payroll business solutions

When you’re investing time into running your successful business, it can become difficult to keep on top of everything. By outsourcing your payroll, you can reduce your costs and save essential business time, allowing you to focus on areas that are important to contributing towards your continued growth.

Contact the team at Growth Partners today to find out more about our all-in-one solution for payroll, pensions, benefits, wellbeing, and employee engagement services.

Outsourcing payroll

Researching Outsourced Payroll Providers | Growth Partners

Researching Outsourced Payroll Providers | Growth Partners 1280 729 Growth Partners

Whether you’re considering outsourcing your company’s payroll for the first time or looking to switch outsourced payroll providers, it’s important to do your research.

Running an SME is tough – the burden of day-to-day administrative tasks and compliance weighs heavy, and it can be difficult to focus on growing your business.

A recent YouGov study reported a quarter of businesses believe managing payroll requires too much of their time and affects their overall business performance.

If you’re looking to grow your business, outsourcing your payroll is a great step towards unburdening yourself from the administrative headache of keeping up with legislative changes and the expectation that you have all the answers to your employees’ payroll and pension queries.

Outsourced payroll providers can also save you money and minimise the risk to your business if you choose the right provider.

In this post, we’ll discuss six important things to consider when outsourcing your payroll:

1. Choose a specialist outsourced payroll provider

There are so many payroll providers to choose from – from specialist outsourced payroll providers and payroll companies to HR companies and accountants.

The accountancy firm that you use for your accounts may be great at accounts, but are they specialists in payroll? If you’re using your accountant for payroll administration or are considering doing so, ask them about their expertise in payroll. Chances are, they might not actually enjoy payroll processing and may prefer to focus on your accounts, which is where their specialism lies. Some accountancy firms will actually outsource your payroll to a third-party specialist payroll provider, so this is also something to consider.

 

2. Check the outsourced payroll provider is fully compliant with HMRC and The Pensions Regulator

Payroll compliance can be a headache if you’re not a specialist in this area. To comply with Government regulations, you must make accurate payments and deductions, provide employees with detailed payslips, file and pay all taxes on time, pay deductions such as pension payments to the right places and keep hold of records for a minimum of three years.

Pension compliance can also be difficult to keep on top of. Under the Pensions Act 2008, you must put staff into a workplace pension scheme and contribute towards it. Auto-enrolment is an important thing to get right, as is re-enrolment. Check with the outsourced payroll provider whether they will handle all the administration of this for you.

How do you know how your chosen pension fund is performing; when was the last time you reviewed the performance of your auto-enrolment fund?

 

3. Ensure transparency

Outsourcing your payroll is not a decision to take lightly – after all, you’re talking about the hard-earned wages of your employees. A seamless transition is best for both you and your employees, so look for a specialist provider who can handle the transition expertly and efficiently.

Ask to see the full process from end-to-end, ask to see their security credentials and how they keep your data safe and check how they’re set up to handle any significant changes to payroll, such as the job retention scheme. These are all things which YOU will be liable for if THEY get wrong, so it’s best to check these from the outset.

 

4. How much input will be required from your finance team?

Unburdening your finance team is a great reason to outsource your payroll. Finance managers are a fantastic asset, and freeing up their time is a win for small businesses. Payroll and pension administration is process heavy and takes a lot of time and accuracy – take the headache away from them, and they will be available to help you grow your business.

Using specialist outsourced payroll providers may also reduce the number of staff you need to recruit to your finance team to administer payroll and pension payments, therefore helping to reduce your fixed costs. A fully outsourced specialist payroll provider will also take care of the administration of new starters and leavers.

The main thing to make sure of here is that you outsource to a specialist who requires minimal interventions from your finance team – otherwise, you could end up giving your finance team an even bigger headache.

 

5. What do you get for your money?

You will find most payroll providers charge a set amount per employee to administer payroll, but check what added value you get.

  • Do they provide any other services for your employees?
  • Do they provide online 24/7 access to pay documents via an app?
  • Do they provide UK-based customer service support to answer your employees’ payroll issues?
  • Are they GDPR compliant?

These are important questions to ask to help you choose the best value payroll provider for you.

 

6. Will they give you peace of mind?

Check if compliance with HMRC and The Pensions Regulator still sits with you. If it does, you may be reducing your fixed costs and saving some money, but you may not feel you have complete peace of mind.

If the compliance still sits with you, this means the payroll providers will administer a company’s payroll and pensions, but ultimately the company directors are still responsible for the payroll providers’ actions and any compliance issues.

 

Our Payroll and Pension services

We’re proud to offer a fully outsourced specialist payroll and pension service with the following benefits:

We deliver our payroll and pension solutions as part of the SMART Employment model, which costs SMEs as little as 30p per day. SMART Employers have more time to focus on business growth, experience increased profitability through reduced costs, increased performance, and have complete peace of mind for themselves and their employees.

If you’d like to know more about outsourced payroll through our SMART Employment model, contact us for a free, no-obligation demonstration of the process and our added value services.

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