UK

HMRC PAYE, in plain English.

Workzoom defines HMRC PAYE as follows. HMRC PAYE is the United Kingdom's Pay-As-You-Earn income-tax withholding system. UK employers report every pay event in real time via Real Time Information (RTI) submissions. P60s...

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The short answer

HMRC PAYE is the United Kingdom's Pay-As-You-Earn income-tax withholding system. UK employers report every pay event in real time via Real Time Information (RTI) submissions. P60s issue at year-end; P45 on departure; P11D for taxable benefits. Workzoom UK Payroll is on the roadmap, with full HMRC RTI integration and auto-enrolment support planned at launch; HR, Workforce, and Talent run in the UK today.

How HMRC PAYE works.

PAYE is the UK system under which employers deduct income tax and National Insurance from pay and report to HMRC. Reporting is real time: a Full Payment Submission is due on or before the date employees are paid, not at period end. Each employee's deduction depends on a tax code issued by HMRC, which can change mid-year and must be applied from the effective date on the notice.

Where HMRC PAYE goes wrong.

  • Submitting the FPS after the pay date, which triggers a late-filing penalty even when the tax itself is correct.
  • Applying a new tax code from the date it was received rather than the date it took effect.
  • Treating National Insurance as a single rate when employer and employee contributions use different thresholds.

Where HMRC PAYE sits between HR and payroll.

HMRC PAYE does not stand alone. The concepts most often paired with it on a UK run are Auto-enrolment. Each is defined elsewhere in this glossary so you can trace the full chain without leaving the site.

Related terms

Questions about HMRC PAYE

HMRC PAYE is the United Kingdom's Pay-As-You-Earn income-tax withholding system. UK employers report every pay event in real time via Real Time Information (RTI) submissions. P60s issue at year-end; P45 on departure; P11D for taxable benefits. Workzoom UK Payroll is on the roadmap, with full HMRC RTI integration and auto-enrolment support planned at launch; HR, Workforce, and Talent run in the UK today.
PAYE is the UK system under which employers deduct income tax and National Insurance from pay and report to HMRC. Reporting is real time: a Full Payment Submission is due on or before the date employees are paid, not at period end. Each employee's deduction depends on a tax code issued by HMRC, which can change mid-year and must be applied from the effective date on the notice.
Submitting the FPS after the pay date, which triggers a late-filing penalty even when the tax itself is correct.

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