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  1. Register with HM Revenue & Customs (HMRC) as an employer.

  2. Obtain a PAYE reference number and set up a payroll system to calculate and deduct income tax and National Insurance contributions (NICs) from employees' pay.

  3. Decide on a pay period, such as weekly or monthly, and establish a payroll schedule that aligns with it.

  4. Keep accurate records of each employee's pay, including their salary, deductions, and any other payments or benefits they receive.

  5. Issue payslips to employees at each pay period, outlining their pay and deductions.

  6. Ensure that payroll taxes, such as income tax and NICs, are paid to HMRC on time.

  7. Keep records of employees' holiday entitlements and monitor their holiday requests to ensure they are in line with the company's policies and statutory requirements.

  8. Provide employees with paid annual leave and ensure they are paid at the correct rate during their time off.

  9. Ensure that employees receive the correct pay for any statutory leave entitlements, such as maternity or paternity leave.

  10. Keep up-to-date with changes to employment law, tax regulations, and holiday entitlements, and ensure that your payroll and holiday policies are compliant with these requirements.

Download our free Employee Handbook and Terms & Conditions of Employment.
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