UK payroll software by type of business

Identifying which shape you need

1. Establish the engagement type. Employees, workers through an umbrella, or subcontractors under CIS. This is a legal question about status and it determines the product entirely.
2. Confirm the returns you owe. RTI submissions, CIS monthly returns, or both. A product that files one and not the other leaves a monthly deadline uncovered.
3. Check the pension and holiday treatment. Auto enrolment applies to workers as well as employees in many arrangements, and holiday pay in umbrella structures has been a recurring source of dispute. Both should be handled explicitly rather than assumed.

Ordinary employer payroll

Real time reporting on or before each pay day, auto enrolment assessment every period, statutory payments, and a year end. This is the product most British employers need, and the market is mature enough that the main differences are the integrations and the support rather than the calculation.

The decisions that matter are whether filing is yours or the vendor's, which pension providers it reports to directly, and how it handles holiday for irregular hours workers. Those three shorten a shortlist faster than any feature list.

Umbrella payroll software, which serves a different business

An umbrella company employs the worker and invoices the end client, so its software has to handle an assignment rate, the costs deducted from it, holiday pay, and a payslip that makes the whole chain legible to the worker. Transparency here has been a sustained area of scrutiny.

If you are an agency or a client rather than an umbrella, your question is usually about compliance in the supply chain rather than about running payroll. Buying umbrella software would be answering a question you do not have.

CIS payroll software for construction

Under the Construction Industry Scheme a contractor verifies subcontractors, deducts at the right rate, files a monthly return and issues statements. That is a separate obligation from employee payroll and most contractors owe both at once.

Look for verification built in rather than performed on a government portal and typed back, and for the monthly return to be produced from the payments rather than assembled. Those two turn a recurring afternoon into a review.

Common questions

Can one CIS payroll software product run employee payroll too?

Several do and that is usually what a construction employer needs, because both obligations run monthly against overlapping data.

Who is responsible for an umbrella worker's payroll?

The umbrella employs them and runs it, and agencies and end clients still carry supply chain responsibilities. The answer depends on the arrangement, so confirm your own position.

Does UK payroll software handle Scotland and Wales?

It must, because income tax rates differ. Confirm it identifies the right tax regime from the employee record rather than from a manual setting.

What is needed at year end?

Final submissions and employee statements to a set calendar. Ask to see the year end process rather than assume it is a button.

What should union payroll software handle?

Where a workforce is unionised, the payroll product has to hold the rates and progression the agreement sets, apply a backdated pay award as arrears without manual entries, and deduct trade union subscriptions from pay where the worker has agreed to it, paying them over to the union and showing them on the payslip. Most UK employer payroll products can do this as a standing deduction; ask the vendor to show a backdated award running through a closed period before you buy.

Coverage by country

• Employer of record vendors covering Singapore
• Employer of record vendors covering Mexico
• Employer of record vendors covering Spain
• Employer of record vendors covering Colombia
• Employer of record vendors covering United Kingdom
• Employer of record vendors covering France
• Employer of record vendors covering Hungary
• Employer of record vendors covering New Zealand