Set up a basic record-keeping system

Wages book

If you employ staff, you will need to keep a record of how much you pay each of them and the deductions made from their wages.

For each employee you must keep a record of:

  • their gross pay (the mains things that count are wages, salary, overtime payments, statutory payments)
  • any tax deducted or refunded
  • any National Insurance contributions (NICs) deducted or refunded
  • any Student Loan deductions

For PAYE you must report this information online in real time. See PAYE and payroll for employers and payroll software.

Why do I need to keep wages records?

  • You will have a single, detailed record of one of the most significant costs for most small businesses.
  • You will be able to easily answer any staff questions you may receive when they come to do their own Self Assessment income tax returns.
  • You will be able to prove that you pay the national minimum wage and equal pay for work of equal value should you need to.

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