Module: PYGB | Molga: 11 | Currency: GBP | Group: Europe
Includes: PAYE | National Insurance (NIC) | RTI | P60/P11D | Auto-enrolment pension | 3 case studies
🧭 The Gross-to-Net Pipeline
Gross Pay (/101) → National Insurance EE → Income Tax PAYE → Net Pay (/560)
UK payroll uses Real Time Information (RTI) — every payment reported to HMRC on or before pay day. Employee NIC (Class 1) + PAYE income tax are the two main deductions.
📌 UK Payroll Anchors (2025-26)
- PAYE: progressive 20% / 40% / 45% (basic/higher/additional rate)
- Personal Allowance: GBP 12,570/year
- NIC Employee (Class 1): 8% on GBP 12,570–50,270; 2% above
- NIC Employer (Class 1): 13.8% above secondary threshold (GBP 9,100)
- Auto-enrolment pension: min 5% EE + 3% ER (of qualifying earnings)
- RTI: FPS (Full Payment Submission) per payroll run
- P60: annual summary by May 31; P11D: benefits by July 6
👥 Case Studies
ㅤ | Case A: Engineer | Case B: Part-timer | Case C: Manager |
Annual Salary | GBP 40,000 | GBP 18,000 | GBP 95,000 |
Tax Code | 1257L | 1257L | 1257L |
NIC Category | A | A | A |
Monthly Gross | GBP 3,333 | GBP 1,500 | GBP 7,917 |
🏗️ Step 1 — Salary Structure (GBP)
Component | WT | Monthly (GBP) | Notes |
Basic Salary | GB01 | 3,333 | Subject to PAYE + NIC |
Pension EE (5%) | GB60 | −167 | Auto-enrolment deduction |
GROSS /101 | ㅤ | 3,333 | ㅤ |
🔢 Step 2 — NIC (Case A: GBP 3,333/month)
- NIC on GBP 3,333 − (GBP 1,048 Primary Threshold) = GBP 2,285
- NIC at 8%: GBP 183/month
- ER NIC: GBP 3,333 − GBP 758 (secondary threshold) = GBP 2,575 × 13.8% = GBP 355
🔢 Step 3 — PAYE Income Tax
- Taxable pay: GBP 3,333 − GBP 1,048 (monthly personal allowance) = GBP 2,285
- Basic rate 20%: GBP 457/month
🔢 Step 4 — Net Pay Summary
ㅤ | GBP 3,333 gross |
Gross /101 | 3,333 |
NIC EE | −183 |
PAYE Tax | −457 |
Pension EE | −167 |
Net /560 | ~2,526 |
⚙️ Schema GB Touchpoints
PCR GBNI— NIC table look-up (category A/B/C/J etc.)
PCR GBTX— PAYE calculation using tax code
ACTIO GBRT— RTI FPS submission trigger
ACTIO GBAE— Auto-enrolment assessment
🏷️ Key Wage Types
WT | Description | Payslip? |
GB01 | Gross Pay | ✅ |
/3N1 | NIC Employee | ✅ |
/3T1 | PAYE Tax | ✅ |
/3PE | Pension EE | ✅ |
/560 | Net Pay | ✅ |
📅 Statutory Calendar (UK)
Activity | Deadline |
RTI FPS submission | On or before pay day |
NIC/PAYE payment to HMRC | 19th/22nd of following month |
P60 to employees | By 31 May |
P11D benefits | By 6 July |
SuccessLabs Academy | SAP ECP UK Payroll (PYGB) | Gross-to-Net Playbook