Good to know
Local Currency: Pound Sterling (GBP)
Minimum Salary: The National Living Wage is £9.50 gross/hour as of April 1, 2022, for employees who are over 23 years old.
In the UK, the minimum wage depends on the age of the employee. There is a National Minimum Wage that varies by age for employees under 23 and an Apprentice Rate.
Tax Year: 5th April – 6th April
Legal Working Hours: an employee cannot work more than 48 hours/week on average (over approximately 17 weeks).
There are exceptions depending on the sector of activity. On average, British people work 37.5 hours per week.
Paid Leave: Most workers who work a 5-day work week are required to have at least 28 days of paid vacation per year. This is equivalent to 5.6 weeks of vacation.
An employer may include public holidays in the statutory annual leave.
About the United Kingdom
Many businesses locate their EU headquarters in the UK. London is one of the main location’s businesses are based. UK has the lowest headline business tax rate in the G20. Currently the UK corporation tax rate is 19%.
The country has a wide variety of highly dynamic economic sectors including the music industry.
Fun Fact: According to the report “The Economic Impact of Music in Europe”, the music sector contributed a total of 81.9 billion euros to the GDP of the 27 European countries in 2018. And the biggest contributor is the UK, which accounts for 20% of this figure.
The UK is an attractive country that offers many benefits to businesses. However, any company wishing to locate in the UK must ensure fully compliance with payroll and human resources legislation. The English legislative framework is complex and varied.
Our UK payroll and HR experts are dedicated to delivering a fast and efficient service to ensure that your business is always compliant with UK legislation.
Ready to Benefit from UK HR & Payroll Experts?
The British social security system (for employees)
The UK’s general social security system includes sickness and maternity, old age, disability and survivors’ insurance, occupational accidents and diseases, unemployment, and family benefits. Some benefits are residence-based, and others are work-based.
Contributory benefits are generally flat rate.
Source : The Cleiss
Administrative Organisation
The British social protection system is administered by :
- the Department for Work and Pensions for old age pensions, carer’s benefits and assistance to divorced parents (calculation and collection of maintenance payments)
- HM Revenue & Customs for the administration of social security contributions, payment of tax credits for families with dependent children and low-income earners, and Child Benefit, as well as overseeing sickness, maternity, paternity and adoption benefits (paid by employers);
- the Department of Health and Social Care for health insurance benefits in kind in England.
Each National Health Service in the United Kingdom (England, Wales, Scotland and Northern Ireland) has specific jurisdiction over health care.
The Pension Service of the Department for Work and Pensions administers old age pensions and other benefits for pensioners. In Northern Ireland, this function is performed by the Northern Ireland Pension Centre.
Jobcentre Plus, also under the Department for Work and Pensions, provides employment services and advice, helps people of working age to enter the labour market and provides financial support for those who cannot work, including welfare and unemployment benefits. In Northern Ireland, the Jobs and Benefits Office is the reference agency.
Source : The Cleiss
Social contributions in the UK
National Insurance Contributions (NICs) are compulsory in the United Kingdom for workers whose professional income exceeds a certain threshold.
National Insurance contributions are deducted for:
- NHS (National Health Service) – the UK’s public health system.
- Unemployment benefit
- Sickness and disability benefit
- State Pension (retirement scheme)
Employee contributions are not payable for an employee who has reached statutory retirement age (66). Employer’s contributions are paid for employees from the age of 16, with no upper age limit. Contributions are paid on the entire salary and on expenses and benefits. These must be declared to HMRC as contributions and taxes may take these amounts into account.
The rates shown below are for Category A, covering the majority of employees. There are specificities for certain employees (apprentices up to 25 years old, young people under 21, employees with several jobs, etc.).
Employee Contributions from April 6, 2022 to April 5, 2023 | ||||
| Weekly Salary | Employee Contributions | |||
| Up to £242 (1) | – | |||
| from £242,01to £967 | 13,25% | |||
| over £967 | +3,25% | |||
(1) Where weekly earnings are between £123 and £242, contributions are deemed to have been paid (in order to retain pension rights and certain contributory benefits).
People earning less than £123 per week have the option of making voluntary contributions (for pension rights).
Employer Contributions from April 6, 2022 to April 5, 2023 |
||||
| Weekly Salary | Employer Contributions | |||
| Up to £175 | – | |||
| over £175 | 15,05% | |||
Good to know
- Employers with an annual payroll of more than 3 million are required to pay a contribution (0.5% of annual payroll) to fund apprenticeships.
- Employers with less than £100,000 of Class 1 social security contributions in the tax year N-1 can apply for a reduction in contributions, up to £5,000 per year (Employment Allowance).
Source : The Cleiss
Pay As You Earn
Most people pay income tax through the PAYE system. This is the system used by employers or pension bodies to deduct income tax and National Insurance contributions before paying out salary or pension. The tax code tells the employer how much to deduct.
The amount of income tax to be paid in each tax year depends on:
- the amount of income above the personal allowance. The standard personal allowance is $12,570, which is the amount of income on which an employee does not pay tax.
- how much of the income is in each tax bracket.
The table below shows the tax rate for each band if the employee has a standard Personal Allowance of £12,570.
Income tax bands are different if the taxpayer lives in Scotland.
Income Tax rates and bands | ||||
| Band | Taxable Income | Tax Rate | ||
| Personal Allowance | Up to £12,570 | 0% | ||
| Basic rate | £12,571 to £50,270 | 20% | ||
| Higher rate | £50,271 to £150,000 | 40% | ||
| Additional rate rate | over £150,000 | 45% | ||
RTI is the method of information about tax and other deductions under the PAYE system is transmitted electronically to HMRC by the employer every time the payroll is authorised.
Source : gov.uk
Collection
Contributions are paid by the employer to the tax authorities (HMRC) at the same time as income tax (PAYE system). Wages are reported monthly and social security contributions are paid monthly for most employers.
Source : The Cleiss
Our HR & Payroll Experts are Ready to Help
Payroll and HR are different in each country and to each business. Trust one of our local experts to ensure your company’s compliance in the UK.
Our Payroll and HR services in the UK
- Implementation and testing of the software
- An understanding of your individual business payroll processes
- Online payslips & payments
- A dedicated payroll expert
- Data entry & processing
- Payslip distribution
- Personnel & document production
- Legislation compliance
- Highly secure
HR & Payroll in the UK
HR & Payroll in the UK
Good to know
Local Currency: Pound Sterling (GBP)
Minimum Salary: The National Living Wage is £9.50 gross/hour as of April 1, 2022, for employees who are over 23 years old.
In the UK, the minimum wage depends on the age of the employee. There is a National Minimum Wage that varies by age for employees under 23 and an Apprentice Rate.
Tax Year: 5th April – 6th April
Legal Working Hours: an employee cannot work more than 48 hours/week on average (over approximately 17 weeks).
There are exceptions depending on the sector of activity. On average, British people work 37.5 hours per week.
Paid Leave: Most workers who work a 5-day work week are required to have at least 28 days of paid vacation per year. This is equivalent to 5.6 weeks of vacation.
An employer may include public holidays in the statutory annual leave.
Ready to Benefit from UK HR & Payroll Experts?
About the United Kingdom
Many businesses locate their EU headquarters in the UK. London is one of the main location’s businesses are based. UK has the lowest headline business tax rate in the G20. Currently the UK corporation tax rate is 19%.
The country has a wide variety of highly dynamic economic sectors including the music industry.
Fun Fact: According to the report “The Economic Impact of Music in Europe”, the music sector contributed a total of 81.9 billion euros to the GDP of the 27 European countries in 2018. And the biggest contributor is the UK, which accounts for 20% of this figure.
The UK is an attractive country that offers many benefits to businesses. However, any company wishing to locate in the UK must ensure fully compliance with payroll and human resources legislation. The English legislative framework is complex and varied.
Our UK payroll and HR experts are dedicated to delivering a fast and efficient service to ensure that your business is always compliant with UK legislation.
The British social security system (for employees)
The UK’s general social security system includes sickness and maternity, old age, disability and survivors’ insurance, occupational accidents and diseases, unemployment, and family benefits. Some benefits are residence-based, and others are work-based.
Contributory benefits are generally flat rate.
Source: The Cleiss
Administrative Organisation
The British social protection system is administered by :
- the Department for Work and Pensions for old age pensions, carer’s benefits and assistance to divorced parents (calculation and collection of maintenance payments)
- HM Revenue & Customs for the administration of social security contributions, payment of tax credits for families with dependent children and low-income earners, and Child Benefit, as well as overseeing sickness, maternity, paternity and adoption benefits (paid by employers);
- the Department of Health and Social Care for health insurance benefits in kind in England.
The Pension Service of the Department for Work and Pensions administers old age pensions and other benefits for pensioners. In Northern Ireland, this function is performed by the Northern Ireland Pension Centre.
Jobcentre Plus, also under the Department for Work and Pensions, provides employment services and advice, helps people of working age to enter the labour market and provides financial support for those who cannot work, including welfare and unemployment benefits. In Northern Ireland, the Jobs and Benefits Office is the reference agency.
Source: The Cleiss
Social contributions in the UK
National Insurance Contributions (NICs) are compulsory in the United Kingdom for workers whose professional income exceeds a certain threshold.
National Insurance contributions are deducted for:
- NHS (National Health Service) – the UK’s public health system.
- Unemployment benefit
- Sickness and disability benefit
- State Pension (retirement scheme)
Employee contributions are not payable for an employee who has reached statutory retirement age (66). Employer’s contributions are paid for employees from the age of 16, with no upper age limit. Contributions are paid on the entire salary and on expenses and benefits. These must be declared to HMRC as contributions and taxes may take these amounts into account.
The rates shown below are for Category A, covering the majority of employees. There are specificities for certain employees (apprentices up to 25 years old, young people under 21, employees with several jobs, etc.).
Employee Contributions from April 6, 2022 to April 5, 2023 |
||||
| Weekly Salary | Employee Contributions | |||
| Up to £242 (1) | – | |||
| from £242,01to £967 | 13,25% | |||
| over £967 | +3,25% | |||
(1) Where weekly earnings are between £123 and £242, contributions are deemed to have been paid (in order to retain pension rights and certain contributory benefits).
People earning less than £123 per week have the option of making voluntary contributions (for pension rights).
Employer Contributions from April 6, 2022 to April 5, 2023 |
||||
| Weekly Salary | Employer Contributions | |||
| Up to £175 | – | |||
| over £175 | 15,05% | |||
Good to know
- Employers with an annual payroll of more than 3 million are required to pay a contribution (0.5% of annual payroll) to fund apprenticeships.
- Employers with less than £100,000 of Class 1 social security contributions in the tax year N-1 can apply for a reduction in contributions, up to £5,000 per year (Employment Allowance).
Source: The Cleiss
Pay As You Earn
Most people pay income tax through the PAYE system. This is the system used by employers or pension bodies to deduct income tax and National Insurance contributions before paying out salary or pension. The tax code tells the employer how much to deduct.
The amount of income tax to be paid in each tax year depends on:
- the amount of income above the personal allowance. The standard personal allowance is $12,570, which is the amount of income on which an employee does not pay tax.
- how much of the income is in each tax bracket.
The table below shows the tax rate for each band if the employee has a standard Personal Allowance of £12,570.
Income tax bands are different if the taxpayer lives in Scotland.
Income Tax rates and bands |
||||
| Band | Taxable Income | Tax Rate | ||
| Personal Allowance | Up to £12,570 | 0% | ||
| Basic rate | £12,571 to £50,270 | 20% | ||
| Higher rate | £50,271 to £150,000 | 40% | ||
| Additional rate rate | over £150,000 | 45% | ||
RTI is the method of information about tax and other deductions under the PAYE system is transmitted electronically to HMRC by the employer every time the payroll is authorised.
Source : gov.uk
Collection
Contributions are paid by the employer to the tax authorities (HMRC) at the same time as income tax (PAYE system). Wages are reported monthly and social security contributions are paid monthly for most employers.
Source: The Cleiss
Our HR & Payroll Experts are Ready to Help
Payroll and HR are different in each country and to each business. Trust one of our local experts to ensure your company’s compliance in the UK.
Our Payroll and HR services in the UK
- Implementation and testing of the software
- An understanding of your individual business payroll processes
- Online payslips & payments
- A dedicated payroll expert
- Data entry & processing
- Payslip distribution
- Personnel & document production
- Legislation compliance
- Highly secure
Good to know
Local Currency: Pound Sterling (GBP)
Minimum Salary: The National Living Wage is £9.50 gross/hour as of April 1, 2022, for employees who are over 23 years old.
In the UK, the minimum wage depends on the age of the employee. There is a National Minimum Wage that varies by age for employees under 23 and an Apprentice Rate.
Tax Year: 5th April – 6th April
Legal Working Hours: an employee cannot work more than 48 hours/week on average (over approximately 17 weeks).
There are exceptions depending on the sector of activity. On average, British people work 37.5 hours per week.
Paid Leave: Most workers who work a 5-day work week are required to have at least 28 days of paid vacation per year. This is equivalent to 5.6 weeks of vacation.
An employer may include public holidays in the statutory annual leave.
Ready to Benefit from UK HR & Payroll Experts?
About the United Kingdom
Many businesses locate their EU headquarters in the UK. London is one of the main location’s businesses are based. UK has the lowest headline business tax rate in the G20. Currently the UK corporation tax rate is 19%.
The country has a wide variety of highly dynamic economic sectors including the music industry.
Fun Fact: According to the report “The Economic Impact of Music in Europe”, the music sector contributed a total of 81.9 billion euros to the GDP of the 27 European countries in 2018. And the biggest contributor is the UK, which accounts for 20% of this figure.
The UK is an attractive country that offers many benefits to businesses. However, any company wishing to locate in the UK must ensure fully compliance with payroll and human resources legislation. The English legislative framework is complex and varied.
Our UK payroll and HR experts are dedicated to delivering a fast and efficient service to ensure that your business is always compliant with UK legislation.
The British social security system (for employees)
The UK’s general social security system includes sickness and maternity, old age, disability and survivors’ insurance, occupational accidents and diseases, unemployment, and family benefits. Some benefits are residence-based, and others are work-based.
Contributory benefits are generally flat rate.
Source: The Cleiss
Administrative Organisation
The British social protection system is administered by :
- the Department for Work and Pensions for old age pensions, carer’s benefits and assistance to divorced parents (calculation and collection of maintenance payments)
- HM Revenue & Customs for the administration of social security contributions, payment of tax credits for families with dependent children and low-income earners, and Child Benefit, as well as overseeing sickness, maternity, paternity and adoption benefits (paid by employers);
- the Department of Health and Social Care for health insurance benefits in kind in England.
Each National Health Service in the United Kingdom (England, Wales, Scotland and Northern Ireland) has specific jurisdiction over health care.
The Pension Service of the Department for Work and Pensions administers old age pensions and other benefits for pensioners. In Northern Ireland, this function is performed by the Northern Ireland Pension Centre.
Jobcentre Plus, also under the Department for Work and Pensions, provides employment services and advice, helps people of working age to enter the labour market and provides financial support for those who cannot work, including welfare and unemployment benefits. In Northern Ireland, the Jobs and Benefits Office is the reference agency.
Source: The Cleiss
Social contributions in the UK
National Insurance Contributions (NICs) are compulsory in the United Kingdom for workers whose professional income exceeds a certain threshold.
National Insurance contributions are deducted for:
- NHS (National Health Service) – the UK’s public health system.
- Unemployment benefit
- Sickness and disability benefit
- State Pension (retirement scheme)
Employee contributions are not payable for an employee who has reached statutory retirement age (66). Employer’s contributions are paid for employees from the age of 16, with no upper age limit. Contributions are paid on the entire salary and on expenses and benefits. These must be declared to HMRC as contributions and taxes may take these amounts into account.
The rates shown below are for Category A, covering the majority of employees. There are specificities for certain employees (apprentices up to 25 years old, young people under 21, employees with several jobs, etc.).
Employee Contributions from April 6, 2022 to April 5, 2023 |
||||
| Weekly Salary | Employee Contributions | |||
| Up to £242 (1) | – | |||
| from £242,01to £967 | 13,25% | |||
| over £967 | +3,25% | |||
(1) Where weekly earnings are between £123 and £242, contributions are deemed to have been paid (in order to retain pension rights and certain contributory benefits).
People earning less than £123 per week have the option of making voluntary contributions (for pension rights).
Employer Contributions from April 6, 2022 to April 5, 2023 |
||||
| Weekly Salary | Employer Contributions | |||
| Up to £175 | – | |||
| over £175 | 15,05% | |||
Good to know
- Employers with an annual payroll of more than 3 million are required to pay a contribution (0.5% of annual payroll) to fund apprenticeships.
- Employers with less than £100,000 of Class 1 social security contributions in the tax year N-1 can apply for a reduction in contributions, up to £5,000 per year (Employment Allowance).
Source: The Cleiss
Pay As You Earn
Most people pay income tax through the PAYE system. This is the system used by employers or pension bodies to deduct income tax and National Insurance contributions before paying out salary or pension. The tax code tells the employer how much to deduct.
The amount of income tax to be paid in each tax year depends on:
- the amount of income above the personal allowance. The standard personal allowance is $12,570, which is the amount of income on which an employee does not pay tax.
- how much of the income is in each tax bracket.
The table below shows the tax rate for each band if the employee has a standard Personal Allowance of £12,570.
Income tax bands are different if the taxpayer lives in Scotland.
Income Tax rates and bands |
||||
| Band | Taxable Income | Tax Rate | ||
| Personal Allowance | Up to £12,570 | 0% | ||
| Basic rate | £12,571 to £50,270 | 20% | ||
| Higher rate | £50,271 to £150,000 | 40% | ||
| Additional rate rate | over £150,000 | 45% | ||
RTI is the method of information about tax and other deductions under the PAYE system is transmitted electronically to HMRC by the employer every time the payroll is authorised.
Source : gov.uk
Collection
Contributions are paid by the employer to the tax authorities (HMRC) at the same time as income tax (PAYE system). Wages are reported monthly and social security contributions are paid monthly for most employers.
Source: The Cleiss
Our HR & Payroll Experts are Ready to Help
Payroll and HR are different in each country and to each business. Trust one of our local experts to ensure your company’s compliance in the UK.
Our Payroll and HR services in the UK
- Implementation and testing of the software
- An understanding of your individual business payroll processes
- Online payslips & payments
- A dedicated payroll expert
- Data entry & processing
- Payslip distribution
- Personnel & document production
- Legislation compliance
- Highly secure