PAYE rates are normally stored in a company 00 or global data file and used by all payroll companies on your payroll system.
Warning: PAYE rates are automatically updated as a part of the annual payroll software update but they should always be checked after the update prior to calculating the first payroll of the new Pay As You Earn year for all payroll companies to ensure the correct rates are present. They should then be revised again in May or June or whenever advised when PAYE rates are altered as a result of a budget announcement.
If the top of the form shows a message There is only one global PAYE rate file therefore it only necessary to check the PAYE rates in a single payroll company then you only need to check the parameters in the one payroll company.
If the top of the form shows a message similar to Payroll companies 00 and 02 PAYE rate files therefore you should check the PAYE rates parameters for each of these companies following annual upgrades then you should check the parameters in one of the companies other than a non 00 company listed, that is, not company 02 in this example and also in the non company/companies listed - company 02 in this example.
If the top of the form shows a message similar to There are more than 100 payroll companies with PAYE rate files therefore you should check the PAYE rate parameters for ALL companies following annual upgrades then you should check as advised all payroll companies.
If the top of the form also shows a message It is recommended that you contact software support to review your system then you should contact your accounts software support team since the parameters found are not as expected.
To access the PAYE rates
The Payroll Password form is displayed.
Enter your payroll password.
The PAYROLL menu is displayed.
Select the System maintenance option.
The PR SYSTEM MAINTENANCE menu is displayed.
Select the PAYE rates option.
The PAYE rates form is displayed.
PAYE rates form
The PAYE rates form is displayed when you select the PAYE rates option from the PR SYSTEM MAINTENANCE menu.
What do you want to do or be advised about?
Maintenance of the PAYE rates
The PAYE rates record consists of two TABs called PAYE Rates and Audit.
To amend the PAYE rates record click the Amend button, make the amendments and click the Save button to save the changes.
PAYE Rates Tab
Table identifier: This is system controlled and will always be set to PAYE.
Rate (%), Threshold and Band table
A grid consisting of up to twelve different percentage rates, thresholds and bands is present on the PAYE rates record.
Rate (%): The rate of PAYE charged on the gross pay for tax.
Threshold: The maximum free pay earnings used on an annual basis when applying the rate (%) to the gross pay for tax.
Band: The amount of free pay earnings for tax purposes within the threshold that has the rate (%) applied.
Other fields
Basic rate: The PAYE grid row used for PAYE calculations when an employee has their tax prefix/suffix set to BR. For the 2006-2007 PAYE year the Basic rate is PAYE grid row 2 representing a rate of 22% of free pay for tax purposes.
If an employee has a tax prefix/suffix set to D the employee is taxed using the rate defined by their tax code + 1 + the Basic rate.
Example
For the 2006-2007 PAYE year an employee with a D0 tax code is taxed at the rate in row 0+1+2 = row 3 = 40%Emergency tax code: The emergency code to be used as a comparison test for earnings when deciding if to submit a P46 record via the internet to HMRC.
Scottish Variable Rate: A % variation of +/- 3% to be applied to the Basic rate for employees who are classified as Scottish for PAYE purposes. This is often abbreviated to SVR. In the 2006-2007 PAYE year as on previous PAYE years this is 0%.
Example
IF the SVR was set to 1% and an employee classified as Scottish for PAYE reasons had a tax code of BR the employee would be taxed at the rate in row 2 + 1% = 23%.
Example
For the standard tax suffix codes of L, P, T, V and Y and tax prefix K a gross pay for tax figure is adjusted using the tax code on the payroll record to form a free pay value. If the free pay is for example 35,000 pounds by the end of the 2006-2007 PAYE year the employee would have paid 10% * 2150 + 22% * 31150 + 40% * (35000 - 2150 - 31150).
What do you want to do?
Audit Tab
The Audit form is displayed when you select the Audit Tab from the PAYE rates form.
The audit data TAB is system maintained and may be used to check when and by who the PAYE rates record has been amended.
The following fields are displayed on the Audit Tab. All of these fields are self-explanatory and thus no explanation is supplied.
Date last edit
Time last edit
Last edit by
Terminal last edit
What do you want to do?
PUSH BUTTONS:
Exit: Returns you to the PR SYSTEM MAINTENANCE menu.
Help: Displays help on the current application in your default company browser.
Amend: Click the Amend button if wanting to amend the PAYE rates record for the current payroll company.
Save: Saves any changes that you have made to the PAYE rates form.
Cancel: Cancels any changes that you have made to the PAYE rates form and returns you to the PR SYSTEM MAINTENANCE menu.
Reporting of PAYE
PAYE may be reported from the following places:-
The Payroll, Reports & enquiries, Period reports menu option called P.A.Y.E. totals
The Payroll, Reports & enquiries, Period reports menu option called P35 listing
The Payroll, Reports & enquiries, Year-end reports menu option called P.A.Y.E. totals
The Payroll, Reports & enquiries, Year-end reports menu option called P35 listing
The Payroll, Reports & enquiries, Year-end reports menu option called P11 report from log
What do you want to do?
