Paying the right amount of tax through PAYE

HMRC are modernising their tax system to help people pay the right tax on their income as they earn it.


What's changing?

From the end of May, HMRC are using the real time information (RTI) you submit to them each pay period to make any necessary changes to your employees’ PAYE tax codes, rather than waiting until the end of the tax year.

These changes will stop people paying too much or too little tax during the year, as they'll pay the right tax on their income as they earn it.

You can find further information from HMRC.

How will this affect me?

If an employee’s circumstances change, HMRC will send you a tax code change notice at that point, as well as sending a copy directly to the employee. You must update the employee's tax code to make sure they pay the right amount of tax.

If you receive any queries from your employees, they can use their online personal tax account to view any changes to their tax code and information on how their tax code is calculated.

How can I check for tax code notices?

Tax code notices are sent straight to your HMRC Mailbox within Sage Payroll. It's easy to access them and automatically apply any changes. To find out how to apply a tax code change in Sage 50 Payroll, watch our quick demo below or read more. If you use Sage Instant Payroll, take a look at our quick guide.

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