PAYE & paying temp staff

[tradersaq]

I intend to try a business on the side under my limited company and have plans to hire 1-2 temp staff initially for 3 months.

- Can I pay staff a daily rate out of my earnings without having to put them on PAYE?

- If Yes, What is the best way to do this properly - paying against weekly invoices by cheque or cash?

- Also, if I anticipate my costs going up in the next few months, is it better not to put myself on the PAYE as I might eventually put the staff on PAYE?

Any advise would be appreciated!

[Fleetwood]

advice

[Mordac]

I intend to try a business on the side under my limited company and have plans to hire 1-2 temp staff initially for 3 months.

- Can I pay staff a daily rate out of my earnings without having to put them on PAYE?

- If Yes, What is the best way to do this properly - paying against weekly invoices by cheque or cash?

- Also, if I anticipate my costs going up in the next few months, is it better not to put myself on the PAYE as I might eventually put the staff on PAYE?

Any advise would be appreciated!

Safest way is probably to use an agency initially. They invoice you, temps get paid on time and the agency handles all the tax stuff. If it looks like working out, you can then switch to your own PAYE system. If it doesn't work out, you can invoke the notice period, which is usually a week on agency temps.

[tradersaq]

Thanks!
The problem with paying through an agency is that I pay more in initial rates and pay a commision if I intend to make the staff perm. And the whole idea is to save money (in PAYE taxes) till the business generates revenue and also minimise commitment to staff (no contractual obligation).

[ASB]

Thanks!
The problem with paying through an agency is that I pay more in initial rates and pay a commision if I intend to make the staff perm. And the whole idea is to save money (in PAYE taxes) till the business generates revenue and also minimise commitment to staff (no contractual obligation).

If you are paying them a day rate outside PAYE they need to be genuinely self employed - and the risk falls on you if they are not.

Surely PAYE is easy enough ?

[TheMonkey]

I intend to try a business on the side under my limited company and have plans to hire 1-2 temp staff initially for 3 months.

- Can I pay staff a daily rate out of my earnings without having to put them on PAYE?

- If Yes, What is the best way to do this properly - paying against weekly invoices by cheque or cash?

- Also, if I anticipate my costs going up in the next few months, is it better not to put myself on the PAYE as I might eventually put the staff on PAYE?

Any advise would be appreciated!

1. You have to put them on PAYE unless they are self employed. There is no way to avoid this. YOUR COMPANY is also liable for THEIR tax if they aren't paying it to the HMRC or they get investigated (so only work with a Limited company if you can). Just do PAYE - it's safer.

2. Pay them weekly by BACS - easy as anything if your bank doesn't charge you for the priviledge.

3. I was on PAYE as a director and it was easier. Remember that directors' PAYE is cumulative over a year so you have to pay it at the end of the year as part of the PAYE return (P35?!? can't remember). This is because your pay can be very variable so it stops you paying yourself one lump payment a year which exceeds the NI ceiling. You don't have to pay yourself anything all the time so just distribute your pay evenly.

Just do the PAYE and pay the damn tax - it's only going to get the HMRC thought police on your botty bot if you don't.