Apprentice pay & registering for PAYE Scheme

bumblebee

Hi all. I think I kind of know the answer but need some suggestions for the experts.

Situation: Client wants to pay an Apprencipe about £100 per week. No PAYE scheme in place. Does the client need to report this to Hmrc?

As far I can gather is that one doesnt need to register for PAYE where employees are paid under LEL (Lower Earnings Limit). Am I correct?

Please advice.

Thank you.

stevo5678

My understanding is that if this is the only person on the payroll then you don't need a formal scheme. However as soon as one person is subject to tax then they all must be included.

bumblebee

Yes thats correct,this will be the only person.Thanks for your input.

leonag

Something to bear in mind also is that if the apprentice has another job, then they will need taxing at code BR for every penny they earn so a scheme would then need setting up regardless of the amount earned in this role.

Also they need to make sure it's an official apprenticeship scheme or minimum wage rules could apply.

Leona

stevo5678

@leonag - agreed I am about to have this with my apprentice which seems harsh as she will still be below the limit. She will need to contact HMRC and request that her allowances are split appropriately across the two jobs to rectify this during the year.

bumblebee

Thank you both.

payrollpro

I think you need to consider something. I totally agree that in the absence of any other information the apprentice will initially be taxed at BR, however, how is your client going to account for the tax and how will they comply with RTI? The painful fact is that if the apprentice produces the necessary form, starters declaration then your client may have to consider using 1000L, if the right declarations are made. I don't think it matters that there is only one person, a payroll is a payroll and the only time we can try to drop out of PAYE is if everyone is paid under both thresholds. This is, I agree, less than £111 for NIC, so in the above case there is no requirement to start a P11 working sheet for NIC purposes, however, as pointed out the threshold for tax might be £192 but then again it might be nil!