What happens on each pay day
Every pay run under our payroll services in Watford follows the same basic steps. We take the hours, salaries, overtime, bonuses and any leavers or starters you send us. From that we work out income tax through PAYE, the system HMRC uses to collect tax from wages, along with employee and employer National Insurance and any pension contributions.
Your staff then receive payslips on or before pay day. By law a payslip has to show pay before and after deductions, any deductions that change from one pay period to the next, and the hours worked where pay depends on time. We also send HMRC a Full Payment Submission, known as an FPS, on or before the date staff are paid. That report is part of Real Time Information, which simply means HMRC sees each pay run as it happens.
You get a short summary showing what to pay each person, what goes to HMRC and what goes to the pension provider. You make the payments, or we can prepare a bank file to make that quicker.
Dates that every employer has to hit
Payroll is full of fixed deadlines, and most penalties we see at Watford employers come from missing one rather than from getting a sum wrong. These are the ones we track for you.
- FPS on or before each pay day
- Employer Payment Summary, or EPS, by the 19th of the following month where needed
- PAYE and National Insurance paid to HMRC by the 22nd if paying electronically
- P60s given to staff by 31/5 after the tax year ends
- P11D forms for benefits in kind by 6/7
- A P45 for anyone who leaves
What is included
- Weekly, fortnightly, four weekly or monthly pay runs
- Payslips sent to staff on or before pay day
- FPS and EPS submissions to HMRC
- Auto enrolment assessments, letters and pension figures
- Starters, leavers and P45s
- Statutory sick pay and parental pay
- P60s, P11Ds and year end reporting
- Employment Allowance claims where eligible
- Registering a new PAYE scheme
Employer National Insurance and the Employment Allowance
For 2026/27, employers pay National Insurance at 15% on earnings above the secondary threshold. On a small team that soon adds up, so it is worth checking whether you qualify for the Employment Allowance. It can cut your employer National Insurance bill by up to £10,500 a year.
Not everyone can claim it. A limited company where the only employee paid above the secondary threshold is a director cannot use it. Once you take on a second member of staff, things may change, and we check eligibility at the start of each tax year rather than assuming last year's answer still holds. Smaller employers may also be able to pay HMRC quarterly instead of monthly, which some find easier for cash flow.
Workplace pensions without the paperwork headache
Auto enrolment is the rule that makes employers put eligible staff into a workplace pension. It applies to workers aged from 22 up to State Pension age who earn above the earnings trigger. Minimum contributions are 8% of qualifying earnings in total, with at least 3% coming from the employer.
When you first take on staff, you must send a declaration of compliance to The Pensions Regulator within 5 months of your duties starting. Every 3 years after that, you must put eligible staff who have opted out back into the scheme and declare again. We assess each worker on every pay run, send the right letters and pass contribution figures to your provider.
Directors, sick pay and benefits
Directors are treated a little differently. Their National Insurance is normally worked out on an annual earnings basis rather than pay period by pay period, which matters if you pay yourself a large sum in one month. A company must still register as an employer even if the only person on payroll is the director.
Statutory sick pay and parental pay also run through payroll, and we work out what is due when someone is off. Benefits in kind are changing as well. Payrolling benefits, which means taxing them through monthly pay instead of on a P11D, becomes compulsory in phases from 6/4/2027. If you provide health cover or a company car, it is worth planning for that now.
Payroll services in Watford for growing local firms
Payroll looks quite different from one business to the next around here. A restaurant in the town centre might have part time staff on variable hours and tips to deal with. Production suppliers near Warner Bros. Studios Leavesden can have short contracts and staff who start and finish at odd points in the year. Units on Watford Business Park often employ warehouse and trade staff on a mix of hourly and salaried pay.
Our payroll services in Watford cover all of those, along with employers in Abbots Langley, Borehamwood and St Albans. Work is handled online, so you send changes by email or through a shared folder and we do the rest. Late reports to HMRC can bring penalties, which grow with the number of employees, so a dependable routine is worth more than anything clever.
If you are taking on your first employee in Hertfordshire, our payroll services in Watford can set up the PAYE scheme, register with HMRC before the first pay day and pick a pension provider with you.
Who this suits
- Directors paying themselves a salary through a limited company
- Restaurants, cafés and shops with part time or hourly staff
- Trades and warehouse businesses with a mix of pay types
- Film and TV suppliers with short term staff
- First time employers taking on their first hire
- Businesses taking over payroll from another provider
Common questions
I am the only director. Do I still need a payroll?
If you pay yourself a salary through the company, the company must register as an employer and report that pay to HMRC. Many directors take a modest salary through payroll and the rest as dividends. We can look at what suits your situation before setting it up.
What is the deadline for paying PAYE to HMRC?
If you pay electronically, PAYE and National Insurance for each tax month are due by the 22nd of the following month. Some smaller employers can pay quarterly instead. We send you the amount and the date well before it falls due.
Do I have to put part time staff into a pension?
It depends on their age and earnings rather than their hours. Workers aged 22 to State Pension age who earn above the earnings trigger must be enrolled automatically. Others may have the right to ask to join. We assess every worker on each pay run.
How much does employer National Insurance cost in 2026/27?
Employers pay 15% on each employee's earnings above the secondary threshold. The Employment Allowance can reduce the total by up to £10,500 a year if you are eligible.
What happens if a payroll report reaches HMRC late?
HMRC can charge penalties for late FPS returns, and the amount depends on how many employees you have. Interest can also be charged on late payments. Filing on or before each pay day avoids both.
Can you take over our payroll in the middle of the tax year?
Yes. We need the year to date figures for each employee from your current provider or software, plus your PAYE reference details. We then carry on from the next pay run without staff noticing a change.
What do I need to send you when someone new starts?
Their full name, address, date of birth, National Insurance number, start date and pay details, plus their P45 or a completed starter checklist. That tells us which tax code to use from their first pay day.