Paying PAYE & NIC

Overview

You must pay your PAYE & NIC bill to HMRC by:

• the 22nd of the next tax month if you pay monthly
• the 22nd after the end of the quarter if you pay quarterly

If you pay by cheque through the post, it must reach HMRC by the 19th of the month.

If your payment is late, you may have to pay interest and penalties.

Payment Methods

You can pay PAYE/NI by:

• Direct Debit
• Online bank account
• Telephone bank transfer
• Debit or corporate credit card online
• Cheque through the post

See Pay employers' PAYE for further details.

Payment References

You will need to use your 13-character Accounts Office reference as the payment reference.

You need to add 4 extra numbers to the 13-character Accounts Office reference number each time you make an early or late payment.  

For example, by using ‘2501’ after the 13-character Accounts Office reference number: 

the ‘25’ represents the end of tax year you are paying for, so 25 would be for the 2024-25 tax year and ‘01’ represents the month. April is the 1^st month of the tax year and so is denoted by ‘01’. May would be 02 and 03 for June or for Quarter 1.

You will need all 17 characters without any spaces to make sure your payment is allocated correctly by HMRC. 

If you pay through the online service, it will work out the extra 4 numbers for you.

Variable Direct Debits

In October 2022, HMRC introduced a Direct Debit option for paying PAYE & NIC.  This service enables employers to set up a variable or recurring Direct Debit instruction, which authorises HMRC to automatically collect payments due from the employer’s bank account, based on the figure declared on the payroll returns, submitted by the employer or payroll agents. HMRC have confirmed that the direct debit will never be greater than the amount declared on the payroll return.

The service can be accessed through Pay employers' PAYE or through your PAYE Online Service Account. Sign into your account through the Government Gateway portal (select your Business tax account and the employers PAYE service).

An employer will be able to view, change or cancel their Direct Debit online. Agents cannot set up direct debits on behalf of clients, as banking rules require direct debits to be set up by a signatory to the bank account.

HMRC will usually take the payment either:

• Shortly after the 22nd of the month, or
• 4 working days after you file the return (if you file it after the 19th of the month)

HMRC will tell you the date and amount no later than 3 working days before the payment is collected. Payments will show as ‘HMRC SDDS’ on your bank statement.

There will be no additional interest charged to employers who choose to pay by variable direct debit, provided that their direct debit payment does not dishonour, for example due to insufficient funds, bank account closed, etc.