How does my company payroll work?

Once you begin trading through your company, you will receive sales income into the business bank account which can then be used to pay yourself and other employees a salary, after accounting for tax and National Insurance.

You will need to have set up your company bank account by this stage, so that your company can receive payment for your products or services, and so that you can refund your expenses and pay yourself a salary.

Competex can run your company payroll for you, and we appreciate that you may wish to pay yourself or other employees different amounts each month.

When you are ready to pay yourself, we will set-up your PAYE scheme and operate this on your behalf. Further employees can be added to the payroll at any time.

Your payroll will be processed on a monthly or annual basis, with computations based on the total funds (including Employer’s National Insurance) that you wish to devote to salaries in that particular month/year unless you advise us differently.

For company directors, National Insurance is charged on an annual basis, which means that no Employer’s or Employee’s National Insurance is payable until your salary meets the annual threshold (pro-rated in the first year from the date of incorporation). When working on assignment for the first time you may also have the benefit of unused tax allowances, and as a result your first net salary payment will probably include less tax and National Insurance than you would normally expect to pay in later months.