Before you want to employ someone, please think carefully whether your business is ready to provide the rights of employees from every aspect.

Being an employer is not only a great responsibility, but also creates significant material burden on a start-up or even on a business already existing.

Being self-employed, as the name suggests, is not necessarily the most ideal form to have employees, but legislation allows you to employ one or more people as employees in your business.

If you are planning to have employees after taking the information above into consideration, first of all, you will have to register your business as an employer.

After this, to prepare the payrolls of the employees, a monthly or weekly payroll service needs to be requisitioned, based on the frequency of paying salaries or wages.

As a part of this, the ones preparing the payroll or the employer must take care of;

• reporting the employee to the self-employed person,
• preparing the payroll, and submitting it to the tax authority,
• preparing and sending out payslips,
• preparing income statements after the work has been completed or at the end of the year, sending them out to the employer, and submitting it to the tax authority,
• transferring the wages to the employees,
• paying the contributions and other deductions after employees to the HM Revenue & Customs.

The rate of contributions payable after the employees depends, among others, on the payable amount. The status also got its name from this concept, i.e. PAYE stands for “Pay As You Earn”.

The payroll months usually start from the 6th of a month and last until next month’s 5th.

Paying or transferring the contributions and other deductions after the employees must be paid until the 19th of a given month in order for the payment to appear on the account of the HM Revenue & Customs by the 22nd without any penalties or default interest.

Employing others is a great responsibility, and requires careful consideration in every case, so if you have any further questions, please contact our colleagues.