There are circumstances where you may want to run several payrolls and thus several PAYE schemes within a single business. For example, the business may have:
- Some employees paid weekly or bi-weekly, with others paid monthly
- Recently merged businesses that have separate payrolls paid at different times
- Branches with different pay structures
- Directors’ pay, which needs to be confidential.
Employers can now apply to have a separate PAYE scheme operational with only a month’s notice.
You need to apply on the P350 form before the beginning of the tax month that precedes the month from which the new PAYE scheme is to apply. For example, if you want a new PAYE scheme to operate from 6 November 2022, the form P350 needs to be submitted to HMRC before 6 October 2022. We can help you apply for a new PAYE scheme.
If you change your mind, you can cancel the new PAYE scheme at any time before the beginning of the tax month when it was due to come into effect.
Remember that you can only claim one annual Employment Allowance (which gives exemption from employers’ Class 1 National Insurance Contributions (NIC) and is now worth up to £5,000) regardless of how many PAYE schemes you operate. You need to nominate the PAYE scheme for which you want to claim the allowance. If the allowance is not fully used on that PAYE scheme, you can claim the remaining balance against the employer’s Class 1 NIC paid on a different PAYE scheme after the end of the tax year.
