How to register as an employer with HMRC (2026/27)

When should you register?

Register as soon as you know your first payday, within the 2-month window. The references arrive by post, so registering a week before payday leaves very little margin. If you plan the first payday for 30 January, the earliest you can register is the end of November and a sensible latest date is mid-December.

A new limited company whose director takes a salary needs a PAYE scheme too, even if no one else is employed. The usual £12,570 director salary is above the £129 a week Lower Earnings Limit, so registration is needed.

How do you register, step by step?

• Have ready: your business name and address, Unique Taxpayer Reference (UTR) and Companies House number if you are a company, your National Insurance number, the date of the first payday, and how many people you will pay¹.
• Limited companies with 1 to 9 directors: use HMRC's online employer registration on GOV.UK. Other types of business, including sole traders and partnerships, follow the GOV.UK route for their business type¹.
• Choose how often you will pay (weekly, monthly) and the expected number of employees. This is for HMRC's records; it does not lock you in.
• Wait for the letter with your employer PAYE reference and Accounts Office reference. Then set up your PAYE Online account in your HMRC business tax account.
• Enter both references in your payroll software, add the employee from their P45 or starter checklist, and send your first FPS on or before payday³.

What do you do after registering?

Each payday the software works out tax and National Insurance and you send an FPS on or before the date you pay³. You pay HMRC by the 22nd of the next tax month (the tax month runs from the 6th to the 5th), or quarterly if your average monthly bill is under £1,500.

If you can claim Employment Allowance, select it in your software and send an Employer Payment Summary (EPS). It takes up to £10,500 a year off employer NI, but not if a director is the only employee paid above £5,000⁴.

Employees in the PAYE scheme	Monthly penalty
1 to 9	£100
10 to 49	£200
50 to 249	£300
250 or more	£400

HMRC can also charge 5% of the tax and NI not reported if a return is more than 3 months late, and interest on late payments⁵.

Worked example: registering for a March first payday

A sole trader takes on one part-time employee at £14,000 a year, paid on the last working day of each month, starting 2 March 2027 with the first payday on 31 March 2027.

• Earliest registration date: 31 January 2027 (2 months before the first payday). Register that week.
• The PAYE letter arrives in February. Set up Basic PAYE Tools or paid software and a NEST pension account.
• 2 March: right to work check already done; written statement handed over on the first day.
• 31 March: run payroll, give a payslip, send the FPS. Payroll works out tax from the tax code on their P45 or starter checklist; over a full year £14,000 means £286 of income tax and £114.40 of employee NI.
• Employer NI on £14,000 is £1,350 for a full year (15% above £5,000). As a sole trader they can claim Employment Allowance, so the employer NI is covered.

Do you need to register if you only pay a little?

If everyone you pay earns under £129 a week (£559 a month), has no other job, gets no pension and receives no taxable expenses or benefits, you do not need to register for PAYE². Keep a record of what you pay and give payslips. As soon as one person crosses a condition, register before their next payday.

Paying a self-employed contractor does not need a PAYE scheme, but get the employment status right first: if they work like an employee, they are likely to be one.