Payroll for Small Business UK: How to Run It

To run payroll you register as an employer with HMRC, use payroll software to work out tax and National Insurance, and send a Full Payment Submission (FPS) to HMRC on or before each payday. You must give every employee a payslip and pay HMRC what you owe each month.

Running payroll: the key tasks and deadlines (2025/26)

Task	Requirement or deadline
Report pay to HMRC	Send a Full Payment Submission (FPS) on or before each payday
Payslips	Give every employee a payslip on or before payday
What a payslip must show	Earnings before and after deductions, variable deductions such as tax and NI, and hours worked if pay varies by time
Payroll software	Use HMRC-recognised software that reports PAYE online
Free option	HMRC's Basic PAYE Tools is free for employers with fewer than 10 employees
Employer Class 1 NI	15% on earnings above the Secondary Threshold (GBP 96 a week, GBP 417 a month, GBP 5,000 a year)
Employment Allowance	Eligible employers can reduce employer Class 1 NI by up to GBP 10,500 a year
No employees paid in a month	Send an Employer Payment Summary (EPS) instead of an FPS
EPS deadline	By the 19th of the following tax month to claim any reductions
Pay HMRC	By the 22nd of the following tax month (19th if paying by post)