How to pay HMRC

Intro

Paying your PAYE (Pay As You Earn) bill to HMRC (Her Majesty's Revenue and Customs) is a crucial task for employers. In this article, we will outline the various payment options, deadlines, and processing times to ensure you meet your PAYE obligations.

PAYE Payment Options

HMRC offers several payment options to make it convenient for employers to pay their PAYE bill:

• Online Payment: You can pay your PAYE bill online using your debit or corporate credit card. This method is quick and secure, and you will receive an instant payment confirmation.
• Telephone Banking: You can also pay your PAYE bill over the phone using your debit or corporate credit card.
• Bank Transfer: You can make a bank transfer from your UK or overseas bank account. Make sure to include your 13-character Accounts Office Reference Number to ensure your payment is allocated correctly.

PAYE Payment Deadlines

It is essential to pay your PAYE bill on time to avoid penalties and interest. The payment deadlines are:

• 22nd of the next tax month: If you pay your employees monthly, you need to pay your PAYE bill by the 22nd of the next tax month.
• 22nd after the end of the quarter: If you pay your employees quarterly, you need to pay your PAYE bill by the 22nd after the end of the quarter.

PAYE Payment Processing Times

The payment processing times vary depending on the payment method you choose:

• Same or next day: Online and telephone banking payments are usually processed on the same or next day.
• 3-5 working days: Bank transfers typically take 3-5 working days to process.

PAYE Components and Deductions

Your PAYE bill consists of various components, including:

• Employee income tax: The income tax deducted from your employees' salaries.
• National Insurance: The National Insurance contributions deducted from your employees' salaries.
• Class 1 and 1B National Insurance: The National Insurance contributions paid by you as an employer.

PAYE Settlement Agreements

If you have a PAYE Settlement Agreement, you need to pay the agreed amount by the deadline to avoid penalties and interest.

Alternative Payment Methods

HMRC no longer sends payment booklets, so you need to use alternative payment methods, such as online banking or telephone banking.

Multiple PAYE Schemes

If you have multiple PAYE schemes, you can make a single payment via CHAPS (Clearing House Automated Payment System) or Bacs (Bankers' Automated Clearing Services).

By following this guide, you can ensure that you pay your PAYE bill correctly and on time, avoiding any penalties and interest. Remember to keep a record of your payments and receipts for your records.