Connect with HMRC

Connect to HMRC to make tax and National Insurance payments to HMRC, and to automate HMRC notifications.

Before you begin

Before you can start using UK Payroll to run your payroll, make sure that you register as a company and connect with HMRC.

1. As a new limited company, you need to register with Companies House. To learn more, see Register your company.
2. Register as an employer so you can begin running payroll for your employers. To learn more, see  Register as an employer.
3. Log into HMRC online services to manage your HMRC account online.
4. Enroll for PAYE for Employers through HMRC online services.
5. Then, enable FPS submissions by navigating to Manage account > Give a team member access to a tax, duty, scheme > Team members. Click Manage taxes and schemes next to your name. Mark PAYE for Employers and click Save.

How to connect to HMRC

1. From the left side bar, navigate to Settings > Company > HMRC.
2. Click Setup Connection.
3. Enter your HMRC (Government Gateway) User ID, HMRC password, Employer PAYE reference, and Accounts office reference.
4. Mark Automatic HMRC payments to enable automatic payments to HMRC.
5. Click Save & close.

How to automate tax code and student loan updates

1. Log into your HMRC account.
2. Under PAYE for employers, select View tax codes or notices and set up alerts.
3. Under Notices preferences, select Change how you get tax code and student loan notices.
4. Change the drop down menu selections to Yes.
5. Click Next, then Submit. The changes may take up to 24 hours to take effect.

Now that you have enabled HMRC updates you no longer have to update your employees’ tax code and student repayments manually!

Note: Enabling student loan start and stop notices covers both Student (SL1 and SL2) and Postgraduate Loans (PGL1 and PGL2).

FAQs

How do we test your HMRC credentials?
UK Payroll sends a blank report to HMRC. If you receive an email from HMRC with the subject Unsuccessful submission for Reference 120/XXXXXXX, your account has been successfully connected.

If you don’t receive this email, it doesn’t mean the connection was unsuccessful. Settings in HMRC may prevent them from sending the email to you.

Why am I seeing an error when I enter my credentials?
If you receive a Validation failed error, ensure you have entered the correct HMRC credentials. If the credentials are correct, check that you have enrolled in PAYE for Employers (this can be found on HMRC’s Business Tax Summary) and check that you have enabled FPS submissions from your account.

What should I do if I receive an Underpayment of PAYE letter from HMRC?
Send our support team:

• A screenshot of your HMRC account with a full view of the tax year the letter relates to.
• A screenshot of the months with outstanding balances. You can expand the months with balances to see a breakdown of what HMRC expected.
• Details of any payments made to HMRC outside of UK Payroll.

Why hasn’t my employees’ National Insurance Number been updated?
We don’t receive automatic updates for National Insurance Numbers, so you will need to monitor and update them manually. If you have an HRIS integration, update the National Insurance Number in the HRIS, and it will sync to UK Payroll.

What should I do if I’m not receiving tax code or student loan updates?
If you’ve recently moved to UK Payroll, the updates could’ve been sent to your prior payroll provider, so reach out to them for assistance. Otherwise, double-check your HRMC settings are correct, and ensure that your employees’ National Insurance numbers are correct.