Employment tax
Employment Tax
Employment tax
Specialist support to manage employment taxes, reduce HMRC risk whilst optimising efficiencies, and incentives for your workforce.
Understanding employment tax challenges
Employment taxes are evolving fast and with every new rule, the responsibilities and risks on employers increases. From IR35 and off-payroll working rules, supply chain oversight, benefits reporting, and National Minimum Wage compliance, the rules are more complex, the risks are higher and HMRC’s focus sharper than ever.
Our employment tax specialists help your business simplify employment tax compliance. We turn complex regulation into clear, actionable guidance helping you to manage PAYE, National Insurance contributions (NICs), expenses, resourcing outside of your payroll, incentives and international mobility with confidence.
Our employment tax services
Construction Industry Scheme (CIS) rules can apply not only to construction companies but also to businesses with significant construction spend. The process is detailed, time-consuming, and subject to HMRC review.
If you’re a contractor or subcontractor, you must comply with the CIS. This means verifying subcontractors’ tax status before making payments, submitting monthly returns to HMRC, and issuing tax statements.
Our specialists help contractors and subcontractors with CIS registration, verification, reporting and tax deductions, ensuring your processes meet HMRC’s requirements.
With the growth of the freelance economy, engaging workers off-payroll has become common - but it comes with risk. Businesses who engage workers off-payroll should consider the employment status if the workers are sole traders. For medium and large businesses, IR35 rules apply if the worker is provided via their own intermediary, such as a Personal Service Company
(PSC). Businesses should also undertake robust due diligence on their labour supply chain to protect against risk of liabilities in the chain being levied on the business.
Where HMRC determines a worker should be treated as employed or as inside IR35, you could face PAYE liabilities going back six years, plus penalties. The rules are complex, with many factors determining status.
We provide practical advice on off-payroll compliance and supply chain risk, helping you:
- Assess worker status correctly
- Apply the right PAYE and National Insurance treatment
- Build best-practice processes to avoid HMRC challenge
- Carry out due diligence on your supply chain
From company car tax to benefits in kind, such as healthcare or relocation support, managing taxable benefits requires robust policies. HMRC reviews in this area often trigger wider investigations.
We review and design employment tax policies, covering:
- Expenses and benefits procedures
- P11D and PAYE Settlement Agreements
- Expense claims and reimbursements
- Staff handbooks and employee communications, including policies relating to home working, travel and subsistence.
Our aim is to balance compliance with commercial practicality - ensuring policies that work for both HMRC and your business.
Being selected for an HMRC employment tax audit can be disruptive, costly and stressful. Our team of employment tax specialists can support you when selected for review by HMRC, helping you at every stage of the audit.
We can also conduct health check reviews which mirror HMRC audits to test and identify how compliant your business is, helping the business withstand HMRC review with minimal disruption. We help you prepare for review, manage correspondence, and minimise any past liabilities. By working hand-in-hand with our Tax Investigations & Dispute Resolution specialists, we adopt a proactive approach that mitigates risk and helps you stay confident under pressure.
Flexible and hybrid working make travel tax more complicated. Costs for commuting, homeworking, site visits or temporary workplaces may all be taxable depending on the circumstances.
We help employers with multiple sites or mobile workers put tax-efficient solutions in place - reducing risk while supporting a modern workforce.
Employee share schemes are a powerful way to attract, retain and motivate key people, but tax rules vary widely. We help businesses design, implement and manage HMRC-approved schemes, including:
- Enterprise Management Incentives (EMI)
- Company Share Option Plans (CSOP)
- Share Incentive Plans (SIP)
- Save As You Earn (SAYE) schemes
Our advisers balance the tax treatment with your commercial goals and growth stage to ensure incentives are effective and compliant.
Our Global mobility services encompass a range of professional support designed to facilitate the international relocation and deployment of employees for businesses. Our expert team at Azets provides comprehensive assistance, from initial planning to managing ongoing employment tax obligations for your globally mobile workforce. We help ensure your business remains compliant and your employees' transition is seamless; we help both the employer and the employee with:
For the employer
- Assignment planning and structuring
- Assignment costing analysis
- Assistance with assignment policy drafting
- Coordination across the various tax jurisdictions involved
- Payroll advice and services (including shadow/modified payrolls)
- Social security advice and compliance
For the employee
- Arrival and departure briefings to outline tax consequences
- Home and host country tax return preparation
- Tax reconciliation calculations
- Through our international network, we offer coordinated global mobility support wherever your workforce operates.
Since April 2024, the National Living Wage applies to workers aged 21 and over - but compliance is about more than paying the headline rate. Complex rules mean even high earners can inadvertently fall below the threshold.
Our specialists provide
- Reviews of pay calculations and risk areas
- Support with HMRC enquiries
- Policy and control design to ensure ongoing compliance
- Training for payroll teams and HR staff
We help businesses avoid costly penalties, reputational damage and enforcement action.
Why choose Azets for employment tax advice?
- Deep expertise across all areas of UK employment tax
- Proactive support to manage compliance and reduce risk
- Practical advice tailored to your workforce and industry
- Integrated specialist services
Speak to an employment tax specialist
Whether you need advice on IR35 compliance, company car tax, taxable benefits, National Minimum Wage, share schemes or global mobility, our experts are here to help.
Contact a specialist
FAQs
Employment taxes are the taxes and contributions that employers must deduct, report and pay in relation to their workforce. They include Income Tax and National Insurance contributions (NICs) collected through PAYE, along with liabilities linked to benefits in kind, share schemes, company cars, the Apprenticeship Levy, and National Minimum Wage compliance.
A taxable benefit (also called a benefit in kind) is any non-cash benefit provided to employees that has a monetary value, such as company cars, private healthcare or gym memberships. These must usually be reported to HMRC.
IR35 (off-payroll working) rules determine whether a contractor should be treated as an employee for tax purposes. If caught by IR35, PAYE and NICs must be applied as if the worker were employed.
Supply chain risk can apply to labour your business uses or supplies to other businesses, and it can arise in terms of a worker being considered an employee or inside IR35. In addition to these risks, businesses can incur liabilities from arrangements further down the chain, such as rules relating to ‘offshore intermediaries’, Umbrella Company fraud, and from April 2026, new rules relating to Umbrella Companies where underpaid PAYE can become a liability of the agency in the chain or where there is no agency a liability of the end business. Due diligence on the supply chain can guard against these liabilities applying to your business.
Employers who underpay can face arrears payments, financial penalties of up to 200% of the shortfall, and public naming by HMRC.
Approved employee share schemes include EMI, CSOP, SIP and SAYE. Each has different eligibility rules and tax advantages for both employer and employee.
They ensure compliance with tax for employees working abroad or inbound to the UK, covering payroll, assignment structuring and cost control.