How does outsourcing payroll work?

It is a very simple process. You just need to sign up with us for a free trial or contact us directly. We will then ask you to provide us with the information for your payroll online. That’s all you need to do. Payslips and reports are sent to your online secure system.

Should I outsource my payroll?

Yes, you definitely should. Business consultants have made it clear that outsourcing some of the non-core functions to professionals can be good for your business. It helps you save time and money, get expertise, ensure compliance with government regulations and make payroll processing safe and secure. Most importantly, you employ your resources on your central functions which allow you to generate more income as well as saving costs.

How much does it cost to outsource payroll?

With 1 employee in your company, dhPayroll is less than £15 per month. We work on a sliding scale so that you only pay for the work we do, and that helps you keep your costs to a minimum. Costs can be as little at £3 per payslip for larger companies with 50 or more employees. We can further reduce by tailoring costs if your payroll is weekly or you have more than 100 employees, so please contact us in any case for further information on the costs. We would be pleased to discuss your requirements and provide you with a quote.

Is outsourcing payroll cost-effective?

Yes, payroll outsourcing is a very cost-effective solution for your business. Think of all the time and money that is spent in calculating payroll in each period, printing, signing and distributing payslips and making payments, software maintenance, keeping up with changes in tax rates and other training issues, recruiting and training payroll staff, along with premises and other IT costs associated with internal payroll staff. Outsourcing is definitely going to cost you less.

When should you outsource payroll?

You should outsource your payroll when you feel that the cost of getting it done in-house is more than outsourcing it to professionals, but also you would like the added benefits of security and simple effective software and secure online access to payslips and P60s for your team. It is best to focus on the core functions of your organisation because that is what drives your business and makes your company successful.

If you’re intending to payroll benefits for the 2018/19 tax year you must register them with HM Revenue and Customs (HMRC) before the start of the tax year – 5^th April 2018.

How to inform HMRC

This can be done online using the ‘Payrolling employee’s taxable benefits and expenses service’, on the HMRC website https://www.gov.uk/guidance/paying-your-employees-expenses-and-benefits-through-your-payroll Or if you prefer, ask your payroll provider to do this for you

Check the Benefits you can Payroll

You can choose to payroll all benefits except:

Living accommodation
Vouchers and credit cards
interest free and low interest (beneficial) loans

These benefits will continue to be reported on the P11D

Changes to make to the Payroll

The cash equivalent of the employees benefit will then need to be added to their pay for 2018/19 tax year, and taxed through the payroll.

Set up a ‘nominal pay component’ for each payrolled benefit,
During the year if the benefit increases or decreases in value, the amount will need to be adjusted.
Don’t forget to add amend record when an employee joins the benefit, or leaves the benefit during the year. A small tweak to your HR processes may be required.
HMRC will make sure that the value of the benefit is not included in your employee’s tax code.

Telling your employees

Before you start payrolling your benefits you will need to notify your employees.

They will require:

A letter explaining that you’re payrolling and what it means for them.
Confirmation of the following before 1 June after the end of each tax year:

details of the benefits that have been payrolled, for example car fuel
the cash equivalent of each benefit that’s been payrolled
separate details of any benefits you haven’t payrolled

If your employees complete a Self-Assessment tax return they’ll need these details so they can report them to HMRC.

We can help

Should you want to payroll your benefits or expenses please contact the team at David Howard. We will be able to deal with it for you, we will:

Contact HMRC on your behalf
Provide you with a template letters for your employees
Provide the end of year Summary for your employees

Contact us

Contact the payroll team by completing the form on our website. Alternatively you can call us on 020 8977 3559 at our Hampton Wick office to speak to an adviser.

How can I Payroll Benefits for 2018/19 Tax Year