Your business does not need to register as an employer with HMRC as soon as you employ your first member of staff if:
- You will be paying them less than £663 per month or £153 per week (from 1st April 2014 to 31st March 2015)
- The employee does not have another job
- The employee does not have a pension
- You are not providing them with taxable benefits
If you do need to take on an employee you need to know how much it will cost you. This will be the amount you want to pay them (which must be above the minimum wage) plus Employer National Insurance Contributions (NICs). See our Payroll Tips page for more information. However there will be no Employers' NICs due until the employee's earnings are £663 per month or more or £153 per week or more so it may be advantageous to you to have two part-time employees who meet the criteria set out above.
You will of course still need to keep records of your employees and their earnings as evidence that you do not need to register as an employer.
If you are the sole director of a limited company it may be advantageous to be registered as an employer as you are also an employee.
We provide the businesses we work with support and advice to help them decide when to take on staff and how much it will cost them, as well as helping them to ensure it works financially for their business. We also provide HR services to help you to understand and comply with your employer obligations.