A client has notified me of a new starter. He started on the 8th October 2012.
I process their payroll every Friday.
My question is if I process their payroll today for week 28 does this correspond to the previous week i.e 1st October to the 7th meaning that he isn't to be added onto payroll until I run it next week? Or does it correspond to this week starting from the 8th?
I've been looking at tax weeks for this year and I'm confused because each week starts on a thursday so when I'm running say week 27 there is actually only 3 days in week 27 and the other 4 days run into the week after if that makes sense.
If you process a week in arrears to enable collation of all attendance data then today's run would be week 27 and the employee would not have started yet.
You need to view how you have paid the entire year as to when the processing date for the 8th should fall but the 8th is definitely in week 28.
HTH,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
A client has notified me of a new starter. He started on the 8th October 2012.
I process their payroll every Friday.
My question is if I process their payroll today for week 28 does this correspond to the previous week i.e 1st October to the 7th meaning that he isn't to be added onto payroll until I run it next week? Or does it correspond to this week starting from the 8th?
I've been looking at tax weeks for this year and I'm confused because each week starts on a thursday so when I'm running say week 27 there is actually only 3 days in week 27 and the other 4 days run into the week after if that makes sense.
No week is ever split like that. Whenever someone is paid you treat it as if the entire payment was for the pay day (in the overwhelming majority of normal circumstances). As I've said before, when the work was done is irrelevant, only the pay day counts for determining week number.
Thanks Tom. I've found out from the employer that they pay their employees for the week they actually worked rather than working a week in hand.
Also, a few weeks ago when the employer rang me to tell me about the new starter she asked for an estimation of how much the net payments would be if his hours were at 30 and he was on minimum wage. As he has a P46 I thought the tax would be a bit higher so estimated it very roughly inbetween £150 - £170.
When I processed his first wage, his net pay worked out at £175.00. The employer rang me saying we (as in myself and them) agreed that the net payments would be £150 per week. I explained that I have no control over how much tax and NI HMRC take and that the figure I gave was a very rough estimate.
She told me I would have to change his last wage to bring it down to £150 to which I replied that he needed to be paid the £175 as he had worked the hours he was supposed to.
She now wants me to ensure that the net payments are round about £150 per week. I explained that the only way to do this would be to reduce his hours. How would I figure out what the gross pay should be to get to a net of £150ish?
And is this allowable, changing someones hours to suit the employers costs after he has already been told he would be working 30 hours? As the 30 hour change may affect his tax credits or may not be the hours that he needs.
Hi Noola,
I would say the hours worked are a question of fact and can't be tweaked. The hourly rate can be adjusted, but not below the minimum wage relevant to the age of the worker. The best way to adjust the rate, assuming your payroll software doesn't allow you to enter a fixed net pay, is to process the payroll multiple times using ever closer estimates of the hourly rate. Tedious, but accurate! Don't process beyond viewing the payslip.
Whatever you do don't help your client to break the law and pay less than minimum wage.
Hope it works out, sounds like a difficult client!
Understand re dates by the way, looks like pay is weekly, in arrears, but not a week in hand. Always tricky as you have almost no time to process each week, unless the hours are fixed and you can run it early - but then you can get caught out with sick & holidays so not ideal.
Stephen.
Many payroll software packages allow you to work from net to gross pay. So in itself that isn't a problem.
The client needs to be aware that (a) they can't pay less gross per hour than NMW and (b) they may be delighted to pay £150/week net now, but by fixing net pay rather than fixing gross pay that they're taking longer term responsibility for changes in the employee's status that might make £150net/week into a very expensive proposition... In such a case they wouldn't be able to have their cake and eat it. If this is the employee's first job they may be paying no PAYE yet, but after some weeks when PAYE starts to bite things the "fixed net pay" proposition may start to look very different. Just be careful because you can be sure that if there are problems they'll be seen as your fault.
