Pay as you earn in construction PAYE
The Pay as you Earn scheme, or more familiarly, PAYE, is the means by which HM Revenue and Customs (HMRC) deduct tax and National Insurance contributions from employees.
Any person, whether an individual or company, who employs someone under a contract of employment is obliged to operate a PAYE scheme and then deduct tax and national insurance before passing those deductions to HMRC.
It is important for potential employers to have a full understanding of these rules and to ensure that they are applied correctly. In particular it is necessary to understand the meaning of “employee” so that PAYE is applied only to those individuals who can be so categorised.
For construction industry employers the application of PAYE has added complexity as the requirements of IR 35 and the Construction Industry Scheme have a direct bearing on the applicability of PAYE in particular cases.
Administering PAYE can be a time-consuming process for employers with a variety of reporting requirements and deadlines to be met. For this reason many small employers prefer to outsource the administration of the scheme to external service providers who undertake full payroll and reporting obligations via the use of proprietary software.
For more details visit HMRC: PAYE
[edit] Related articles on Designing Buildings
- Capital gains tax.
- Construction industry scheme.
- Construction Industry Scheme or IR35?
- Construction recruitment agency.
- Court of appeal ruling on holiday pay and employment status.
- Employee.
- Hourly rate.
- Human resource management in construction.
- IR35.
- IR35: essential steps for compliance.
- Limited appointment.
- National insurance.
- Payroll companies.
- Status determination statement SDS.
- Tax relief.
- Umbrella companies.
- Tax.
- VAT.
[edit] External references
Featured articles and news
Investors in People: CIOB achieves gold
Reflecting a commitment to employees and members.
Scratching beneath the surface; a guide to selection.
ECA 2024 Apprentice of the Year Award
Entries open for submission until May 31.
UK gov apprenticeship funding from April 2024
Brief summary the policy paper updated in March.
For the World Autism Awareness Month of April.
70+ experts appointed to public sector fire safety framework
The Fire Safety (FS2) Framework from LHC Procurement.
Project and programme management codes of practice
CIOB publications for built environment professionals.
The ECA Industry Awards 2024 now open !
Recognising the best in the electrotechnical industry.
Sustainable development concepts decade by decade.
The regenerative structural engineer
A call for design that will repair the natural world.
Buildings that mimic the restorative aspects found in nature.
CIAT publishes Principal Designer Competency Framework
For those considering applying for registration as a PD.
BSRIA Building Reg's guidance: The second staircase
An overview focusing on aspects which most affect the building services industry.
Design codes and pattern books
Harmonious proportions and golden sections.
Introducing or next Guest Editor Arun Baybars
Practising architect and design panel review member.
Quick summary by size, shape, test, material, use or bonding..