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Casual Labour

Casual Labour

A public house landlord (set up as a company) has started employing bar staff on a casual basis. He says that he calculates that across 4 different people the cash payments amounts to about £700 per month (£175 per person per month)

As this per person is less than the weekly amount for NICs does this mean that he won't have to make the Nics payments, or should he take the aggregate amount and therefore pay the NICs etc?

Should he now infact set up PAYE for these casual members of staff?

Many thanks

David

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12th Jul 2010 16:05

Don't be casual!

Whether or not he needs a PAYE scheme, he must apply PAYE procedures in respect of all employees.  Most importantly, he must get each and every employee to complete and sign a form P46 - unless they tick Box A or B to say that it is their only job (and he has no reason to doubt their word), he will have to deduct tax at the basic rate of 20% from whatever he pays them (regardless of whether it is below the NI threshold) and would therefore need a PAYE scheme.  He would then have to submit the relevant forms P46 to HMRC, pay over the tax deductions and file forms P35 & P14 at the end of the tax year.

If any employee is paid more than the NI Lower Earnings Limit of £97 in any week, he would also need a PAYE scheme and to file the end of year returns, even if he never pays anyone more than £110 in any week and would therefore have to deduct NIC.

Quite apart from PAYE, he will need to pay at least the NMW rates, pay for holidays, apply Health & Safety procedures and all the other fun rules that employers have to observe.

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12th Jul 2010 16:24

Forget casual

Agree with the above.   http://www.hmrc.gov.uk/working/intro/casual.htm

"Casual labour" is exactly that - casual.  One off.  And even then its highly unlikely that HMRC will accept it as "casual" if the amount involved is more than a few pounds or more than once.  

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By davetxu
12th Jul 2010 16:47

Many thanks

Thank you to both of you for your replies which were extremely useful.

Kind regards

 

David

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By SteveOH
12th Jul 2010 18:33

Thanks to Euan

May I take this opportunity of saying thanks to Euan for yet another succinct answer to a Paye query. He always takes the time to answer these queries and they are always accurate and clear. I always learn something.

Thanks and keep posting.

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By DMGbus
13th Jul 2010 09:01

Immigration, Asylum and Nationality Act 2006

Apart from the P46 / tax requirements there have been in place, for about 13 years now, rules requiring employers to check the eligibility of workers (casual, part-time or full time) to work in the UK.  The latest revamp of these rules was introduced in February 2008:-

http://www.ukba.homeoffice.gov.uk/employers/preventingillegalworking/complyingwiththelaw/post280208/

 

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