PAYE: inconsistent salary amounts

PAYE: inconsistent salary amounts

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The client set up a limited company half a year ago and a sole director of the company. Client has not registered for PAYE yet. She will start temporary employment from January till March. The amount of hours will vary from one week to another week. I am relatively new in practice and have not deal with payroll before. I am thinking to wait until March to see how much she has in cumulative earnings from that temporary employment, then register her limited company for PAYE, and allocate her salary as a remainder of personal allowance. Do you see any issues in doing this? Say, her monthly salary for March will be £8,000. But the salary in April will suddenly go down due to the beginning of new tax year to £800-900. Can inconsistency in salary raise any concerns from HMRC?

Another option is to register for PAYE now, start paying some salary, but then won't it create any problems as she will be in two different payrolls at the same time from Jan to March?

Replies (3)

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By Tim Vane
17th Nov 2015 23:38

Register now. If you wait until March to register you will be too late to file any salary for the current taxyear. No harm in registering and filing nil FPS each month until you know what you want to pay. She'll be on cumulative pay anyway so no different if you file one big lump in March. But don't leave it and try and do it at the last minute.

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By petersaxton
18th Nov 2015 07:31

Tim

Wise advice about registering early.

If the salary for March is something like £8k that's not a bad salary. Wouldn't the client have all the salary they need for 2015-2016?

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By SteveHa
18th Nov 2015 10:19

Register, and file an EPS showing that there will be no payments until March. That way, you don't need to worry about remembering to file each month. You can simply put it on the backburner until March comes around.

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