Payroll

Real-time management accounts for SME

Managing payroll as an SME in the UK can be surprisingly complex – even if you only have a few employees. PAYE rules, pension contributions, statutory pay, and HMRC reporting all add up fast while your team is expecting accurate and timely payments.

Feeling a bit under pressure to deliver? At BH1 Accounting, we provide reliable, clear, and HMRC-compliant payroll services for small to medium sized businesses in the UK. Whether you pay one director or a full hospitality team with weekly shifts, we take the pressure off your plate and make sure your people are paid correctly and on time.

Struggling with Payroll:

When the pressure feels higher than usual

There are many stressful accounting-related tasks. But payroll can bring your nervousness to a new level as you do not want to let your team down. As London chartered accountants for SMEs, we know all about it: It might be your restaurant staff or real estate agent team, for example, that work hard for you every month while you want to be sure that they stay loyal to your business through their well-earned and timely pay. The crucial point: Most SMEs struggle with payroll not because they do not care but because it is easy to get wrong.

Common issues include incorrect tax codes and National Insurance calculations, missed pension auto-enrolment obligations, unreported starters or leavers, confusion around statutory payments such as sick pay, parental leave, or holiday pay, inconsistent pay dates or errors in net pay, late RTI submissions that result in HMRC penalties, and overlooking the requirement to report employee benefits through P11D filings, which may also give rise to additional tax liabilities.

A wrong PAYE submission can lead to unnecessary income tax for your employees, resulting in awkward conversations for resolution and long hours of correction at the desk. Instead, use our service to ensure that their payroll is processed smoothly – from gross to net, payslip to pension, HMRC to holiday tracking.

FAQ

Do I need payroll if I’m only paying myself?

Not necessarily, but it can be more tax-efficient. If you own a limited one-person-company and pay yourself a salary (even a small one), you can pay yourself by running payroll through PAYE. This ensures that your salary is reported to HMRC, National Insurance contributions are made, and any tax is properly accounted for. Many director-only businesses set a low salary below the NI threshold, combining it with dividend income to stay tax-efficient. However, individual circumstances require individual tax strategies and we can help you find the best one for you! In doing so, we make sure that you stay compliant without you needing to worry about tax codes, payslip generation, or reporting deadlines.

Can you help me stay compliant with holiday pay, sick leave, and statutory entitlements?

Of course! As part of our payroll services for small to medium sized businesses, we help you meet all your legal obligations around employee entitlements, including statutory sick pay (SSP), holiday pay, maternity and paternity leave, and statutory redundancy where applicable.

What are RTI submissions and what happens if I miss them?

RTI (Real Time Information) submissions are legally required reports you must send to HMRC every time you process payroll. These reports include details of employee earnings, tax, and National Insurance contributions. They must be submitted on or before payday.

If you miss an RTI deadline, HMRC can automatically issue penalties (even if the amounts are correct). Repeated errors may trigger a compliance review or interest charges on unpaid liabilities. In short: It is not optional.

We handle all RTI submissions as part of our payroll service. You simply provide your staff updates or changes; we take care of the rest – including correcting past filing mistakes if needed.

I have just hired my first employee – what do I need to do now?

Hiring your first employee is a big step, so congratulations! Yet, the admin side can feel overwhelming. First, you will need to register as an employer with HMRC, set up a PAYE scheme, and choose how you will run payroll (monthly, weekly, or otherwise). You will also need to assess whether your new hire qualifies for auto-enrolment into a pension and choose a provider. To do so, most employers collect a starter form from their new employees, oftentimes also checking their visa status in the meantime (if necessary).

Then comes payslip generation, RTI reporting, National Insurance calculations, and tracking statutory entitlements (like holiday and sick pay). Even a small misstep such as using the wrong tax code can create confusion for your employee and penalties from HMRC.

We guide you through the entire process. As part of our payroll services for small to medium sized businesses in the UK, we handle all setups, registrations, and compliance tasks. You focus on onboarding your new team member while we make sure they are paid accurately and on time from day one.

How do I handle bonuses, commissions, or other variable pay?

Bonuses and variable pay (like sales commissions, performance incentives, or discretionary rewards) must be reported to HMRC through RTI just like regular salary, and taxed accordingly. This includes income tax and National Insurance.

However, timing matters: A year-end bonus paid in April might fall into the new tax year, altering your employee’s tax position. And recurring bonuses can impact pension contributions or benefits calculations.

We help you structure variable pay fairly and compliantly, calculating exact deductions, updating payslips, and ensuring all amounts are correctly reported. You simply tell us the amount and the reason, and we take care of the technical side.

Our payroll support for growing SMEs includes handling bonuses and pay adjustments smoothly, whether they are planned, one-off, or tied to KPIs – so that you can reward your team without worrying about compliance gaps.