How to set up a new off-payroll worker on payroll?

Off payroll workers should be added to the payroll like any other new starter. If you are a "deemed employer" / "fee payer", you must follow the steps below to add a new off-payroll worker.

Please follow the Road Map below:-

Step 1:Click on Employee big button on the Tasking Zone at the top -> Select the menu "Add New Employee".

Step 2:Select "Yes" from the "Off-Payroll Worker" drop-down.

• By selecting "Yes", the RTI Data Item #208 "Off-Payroll Worker subject to the rules" flag / marker / indicator for deemed employees will be set for each payroll run and subsequently included in the Full Payment Submission ( FPS ) on a submission by submission basis to be reported to HMRC.
  

• Please note that this Off-Payroll Worker Indicator should only be used by the "deemed employer" / "fee payer".
  

• The off-payroll worker's own intermediary ( usually a limited company or Personal Service Company - PSC or partnership ) should not use this Indicator. Intermediaries leave it to default setting - "No".

• Deemed Employers can use HMRC's Check Employment Status for Tax ( CEST ) tool when deciding whether the off-payroll working rules apply to an engagement or for assessing the employment status of the workers.

Step 3:Fill in other relevant / mandatory information.

Step 4:Click on "Continue".

Step 5:Choose option "Enter Starter Checklist Details" in the NI & Tax Details section and click on "Continue".

Step 6:Select "Statement C" from the "Employee Selected Statement" drop-down.

• Off-payroll workers will be primarily employed by the Intermediaries. Hence "Statement C" should be selected.

• Selecting "Statement C" will set the Tax Code to "BR".

• If the off-payroll worker does not return the Starter Checklist, "0T" tax code operated on week 1 / month 1 basis would apply. HMRC can then issue another tax code if required.

• Devolved powers that affect tax codes are applied as normal - for e.g. Welsh or Scottish rates of income tax.

Step 7:Select option "No" from the "Student Loan Deduction" & "Postgraduate Loan" drop-downs.

• "Deemed Employer" / "Fee Payer" is not required to make or report "Student Loan" / "Postgraduate Loan Deductions" on behalf of off-payroll workers.

• The student loan / postgraduate loan repayments are expected to be made through Self-Assessment.

Step 8:Click on "Continue".

Step 9:In the Pension section, select option "No" from the "Subject to Auto Enrolment Pension" drop-down.

• Off-payroll workers are not employees of the "fee payer" / "deemed employer". Hence they are not automatically enrolled into a pension.
  

• They are also not entitled to statutory payments.

• The worker's entitlement to statutory payments comes through their employment with their intermediary. They can also contribute to a pension as an employee of their intermediary.

• Workers providing services through intermediaries are also not entitled to employment rights from the "fee payer" / "deemed employer", such as holiday pay.

Step 10:Click on "Continue".

Step 11:Complete the "Optional Details" & "Upload Photo" sections and Click on "Finish" to add the new "Off-payroll Worker".

('Employee's the button positioned in the tasking zone menu at the top. It is the second button from the left)