Registering your limited company as an employer (PAYE)

Does my limited company need to register as an employer?

Your company needs to register as an employer if it will pay anyone, including a director, £129 or more a week, give expenses or benefits, or employ someone who gets a pension or already has another job. Those are the conditions in GOV.UK's register as an employer checker, which also covers construction subcontractors.

GOV.UK's checker asks whether the business will do any of the following:

• Pay any employees, including company directors, £129 or more a week.
• Employ anyone who is getting a pension or already has another job.
• Provide expenses or benefits to employees, including company directors.
• Use subcontractors under the Construction Industry Scheme (CIS), or reclaim CIS deductions taken from payments.

Source: Register as an employer

The pay figure: £129 or £96 a week?

GOV.UK gives two pay figures. HMRC's register as an employer checker and its new employee guidance use £129 a week, the lower earnings limit for the 2026 to 2027 tax year, which is £559 a month or £6,708 a year.

GOV.UK's separate PAYE and payroll for employers guide gives a lower figure, saying you must register if an employee is paid £96 or more a week, as well as for expenses and benefits, a pension, another job or certain benefits. £96 a week is the 2026 to 2027 secondary threshold. If anyone will be paid between £96 and £129 a week, ask HMRC which applies before deciding not to register.

If none of the conditions applies, GOV.UK says you do not need to register yet, but you must still keep records of what you pay. Check again if pay rises, or if someone starts getting a pension, another job, expenses or benefits.

Source: Rates and thresholds for employers 2026 to 2027

Do I need to register for PAYE if I am the only director?

Often, yes. GOV.UK says you must register even if you only employ yourself, for example as the only director of a limited company. The same conditions apply, so under HMRC's checker a director paid £129 or more a week, given expenses or benefits, getting a pension or with another job needs a PAYE scheme.

A director who is the company's only employee should know one extra rule. GOV.UK says a company with just one director cannot claim Employment Allowance if that director is the only employee liable for employer (secondary Class 1) National Insurance.

Running PAYE for the company is separate from your personal tax. Whether you also need to file a personal return is covered in do company directors need to do Self Assessment.

Source: Register as an employer

When can you register for PAYE?

You must register before the company's first payday, because that is when you need the employer PAYE reference. GOV.UK says you cannot register more than 2 months before you start paying people. So aim to register in the 2 months before the first payday; registering a few weeks early leaves time for HMRC's letter.

If you have to pay someone before the reference arrives, GOV.UK says to run payroll, store your Full Payment Submission (FPS), and send it to HMRC as a late FPS once you can.

Source: Register as an employer

How long does it take to get an employer PAYE reference?

GOV.UK does not give a fixed time. After you register, HMRC sends a letter with your employer PAYE reference and your Accounts Office reference. GOV.UK points you to HMRC's reply time checker, which it updates weekly, to see when to expect the letter. That is why registering a few weeks before payday helps.

You need both references. GOV.UK says they are used to report and pay PAYE tax and National Insurance to HMRC. The employer PAYE reference identifies your scheme in your payroll software, and the Accounts Office reference is used when you pay HMRC.

GOV.UK says you then need to enrol for PAYE Online before you can send payroll information to HMRC.

Source: Check when you can expect a reply from HMRC

How to register your company as an employer: step by step

Work through these steps in order. GOV.UK says most limited companies with 1 to 9 directors can register online; a company with 10 or more directors registers by phone.

1. Check the conditions against everyone the company will pay in the current tax year, which started on 6 April, including directors.
2. Fix the first payday. You can register up to 2 months before it, and must register before it.
3. Gather the company and payroll details listed below, including the company's Unique Taxpayer Reference (UTR).
4. Register online through GOV.UK's register as an employer service, or by phone if the company has 10 or more directors.
5. Keep HMRC's letter with the employer PAYE reference and Accounts Office reference, and enrol for PAYE Online.
6. Set up payroll software, add each employee, and send your first FPS on or before the first payday.

Source: Register as an employer

What to have ready before you register

GOV.UK lists the details a limited company gives HMRC when it registers by phone. Having the same details to hand makes any route quicker:

• The company's name, registered address and phone number, and its trading name if different.
• The type of business, for example plumbing or electrical engineering.
• The company's Unique Taxpayer Reference (UTR) and company registration number.
• The names and National Insurance numbers of the company's directors.
• Your own name, email address and phone number, and a postal address for letters if it differs from the company's.
• The date of the first payday, or the date you first provide expenses or benefits if that is earlier.
• How many people you will employ in this tax year, whether you will use construction subcontractors, and whether you will run an occupational pension scheme.

Source: Register as an employer

After you register: payroll software, RTI and the FPS

PAYE is reported in real time. If you run payroll yourself, GOV.UK says you must report each employee's pay and deductions to HMRC on or before every payday, in a Full Payment Submission (FPS). A new employee is registered with HMRC through your FPS, using their P45 or HMRC's starter checklist.

You must use payroll software that reports PAYE information online, unless you are exempt. GOV.UK publishes a list of HMRC-recognised payroll software but does not recommend any product. You can also pay a payroll provider, but GOV.UK says the employer stays legally responsible for all PAYE tasks.

Pay HMRC what you owe by the 22nd of the next tax month, or the 19th if you pay by post. GOV.UK says a small employer that expects to pay less than £1,500 a month can arrange with HMRC to pay quarterly. In a tax month when you pay nobody, send an Employer Payment Summary (EPS) instead of an FPS.

Do not register too soon and then do nothing. GOV.UK says HMRC will close a new employer's PAYE scheme if it does not send a report to, or pay, HMRC within 120 days. If the company later stops paying people for good, see how to close a PAYE scheme.

Source: Running payroll

Workplace pensions and other duties when you first employ someone

Registering for PAYE is one step on GOV.UK's list for employing staff for the first time. The others include checking who counts as an employee, your workplace pension duties, and getting Employers' Liability insurance unless an exemption applies.

Workplace pension duties start as soon as your first member of staff starts working for you, which GOV.UK calls your duties start date. Use GOV.UK's workplace pension guidance and The Pensions Regulator's tool for employers to check what your company must do and when. We do not set up pension schemes.

Keep payroll records, including what you pay, deductions and reports to HMRC, for 3 years from the end of the tax year they relate to. Payroll sits alongside your other director filing responsibilities at Companies House and HMRC.

Source: Set up and manage a workplace pension scheme

Common mistakes when setting up PAYE

These mistakes can lead to late or missing payroll reports for a new employer.

• Assuming a director-only company never needs PAYE. Check the conditions against the director's own pay, benefits and other jobs.
• Leaving registration until payday. Without the reference, the first FPS has to be stored and sent late.
• Registering more than 2 months before the first payday, which GOV.UK does not allow.
• Registering early and then sending no reports or payments, so HMRC closes the new scheme after 120 days.
• Confusing the employer PAYE reference with the Accounts Office reference, which is used to pay HMRC.
• Not sending an EPS for a tax month in which nobody was paid.
• Forgetting workplace pension duties, which start with the first member of staff.

Source: Running payroll

How SimpleFilings can help

Our PAYE registration service prepares your company's employer PAYE registration and sends it to HMRC as your agent once the company has authorised us. Our £4.99 SimpleFilings service fee applies to the filing. HMRC then posts the employer PAYE reference to the company.

We do not run payroll, send FPS or EPS returns, set up workplace pensions or pay tax for you. Once the scheme is open, those are done through your payroll software or payroll provider.