Statutory deductions, reliefs and tax bands
Configure the maths behind every payslip.
For: Owners & admins · Category: Payroll
The Settings tab is where you define how pay is calculated: statutory deductions (like pension), reliefs that reduce taxable pay, and progressive PAYE tax bands.
Steps
- Statutory deductions - Add each deduction with its base (gross, basic or basic+housing+transport), employee % and employer %, whether it reduces taxable pay, and on/off.
- Reliefs - Add reliefs as a fixed amount per year, a percent of gross, or the higher of the two.
- Tax bands - Build progressive PAYE bands (each band has an "up to" amount and a rate); reorder them and leave the last one open for the remainder.
- Minimum tax - Optionally enable a minimum-tax percentage. Then Save.
Tips
- The "reduces taxable" switch decides whether a deduction comes off before PAYE is worked out.
- Order matters for bands - put them lowest to highest, with the top band left open.