Frequently Asked Questions
Q. What do I have to do when I become an employer?
You have to register as an employer and set up a PAYE scheme on behalf of your PA.
Why can't my employee do this themself?
Because it is your responsibility as their employer.
But can't they be self-employed?
No. In most cases PAs do not meet HMRC criteria for self-employment.
What if I don't register and just keep quiet about it?
It is a criminal offence not to declare employment - carrying a large fine or prison sentence on conviction.
What benefit is there in operating PAYE for my PA?
The National Insurance Contributions you make on their behalf count towards their state pension as well as other state benefits. Your PA is more likely to stay with you if they are treated properly as an employee. This is part of that process.
How do I pay my PA's tax and NI?
As a small employer you will pay it every three months using a slip from your scheme payment booklet provided by HMRC.
What do I have to do as an employer with a PAYE scheme?
- Keep full tax records
- Supply your PA with regular payslips showing tax and NI deductions made on their behalf
- Process and file various forms including P45's, P60's and an Employer's Annual return
- Operate Statutory Sick Pay and Maternity Pay if these apply to your PA at any time
Is there any risk involved if I do the paperwork myself?
If you miscalculate and underpay your tax liability, you will be charged interest on the balance. If you file your Annual return after the annual deadline (May 19th) you will face an automatic penalty of £100 for every month filed late.