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When you start employing staff within your business, or using subcontractors for construction work, you need to register as an employer with HM Revenue and Customs (HMRC). Even if you are only employing yourself, perhaps you are the only director of a limited company, you must still register as an employer. 

This article will lay out how businesses can register with HMRC as an employer, the steps involved in this registration and what information you need to provide to HMRC if you want to register as an employer. 

How do I register as an Employer? 

In order for a company to pay an employee, an employer reference number is required. You must register as an employer with HMRC before the first payday, and you cannot register more than 2 months before you start paying people. The time frame for obtaining an employer PAYE reference number from HMRC can take up to 5 working days. 

An employer PAYE reference number is given to every business that registers as an employer with HMRC. It is a unique combination of numbers and letters that HMRC will use to identify your business. 

The procedure for obtaining your employee PAYE reference number assists businesses in running payroll and storing payments. You can operate PAYE by paying a payroll provider such as a bureau or accountant to run your payroll. If you run, or running payroll yourself, you will need to which includes registering as an employer with HMRC and telling them about your employees. 

How to register as an employer with the HMRC? 

A company can register as an employer with HMRC in various ways. 

Businesses which already have an HMRC online account can log in and use HMRC’s register as an employer service, as there is an option to register for additional services, and selecting the PAYE or CIS enrolment (Construction Industry Scheme), upon logging into your account. 

If a company is registered for VAT and submit VAT returns electronically to HMRC, that will be your HMRC online account. 

If you want to register as an employer or you want to find out more about how to register as an employer, you can take a look at the HMRC website or register with HMRC as an employer here. 

What information will HMRC require in order for you to register as an employer? 

HMRC will require some information from you in order to start the process of registering as an employer. This information includes: 

● company UTR (unique taxpayer reference) 
● company name 
● business address 
● The date the first payment will be made to your employees 
● number of employees, including directors 
● whether you will need to register for CIS (Construction Industry Scheme, where contractors take money from a subcontractor’s payments and give it to HMRC)
● whether you intend to provide expenses and benefits to your employees 
● contact email address for your company 
● name of the director 
● national insurance number of the director 

Once you have this information ready to provide to HMRC, you can register as an employer. 

What happens if you do not register as an employer with HMRC? 

A company can face consequences or penalties if they do not register as an employer with HMRC, or if the payment submission to HMRC is late. 

If a company delays or fails to register its employees, they can be fined. When you begin to pay employees you need to make a full payment submission to HMRC, and if this is late the penalty is £100 per month for businesses with 1 to 9 employees. 

One reason which will be accepted by HMRC for submitting the payment submission late is not receiving the PAYE reference at the time it was due, but the application was sent in on time. 

If a company does not register as an employer, HMRC will not deduct the correct amount of tax from your employees, and will hold the company liable for any deductions, including interest and penalties on top of this. 

Severe penalties like imprisonment can result if you have failed to pay tax from your employees to HMRC. 

Related articles 

How to register a business name 
How to Register a Trademark in Europe 
Legal Considerations When Starting Your Own Business 
Construction part 1 - Starting a construction business 

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LawBite’s mission is to democratise how SMEs get the expert law they need - easier to access, clearer to understand, and much more affordable. We connect you with the best lawyers to give you top class legal advice. If you were wondering how to register as an employer in the UK, we hope this blog has been helpful in addressing the process of registering as an employer through HMRC, as well as the information needed to register. 

If you have any questions about LawBite, take a look through our FAQs or make an enquiry with us and get a free 15-minute consultation with one of our expert lawyers. 

If you want to know more about registering as an employer with HMRC, you can visit the HMRC website and start the process of registering as an employer.

In closing

Nothing in this article constitutes legal advice on which you should rely. The article is provided for general information purposes only. Professional legal advice should always be sought before taking any action relating to or relying on the content of this article. Our Platform Terms of Use apply to this article.

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