{"id":7747,"date":"2020-07-07T11:59:08","date_gmt":"2020-07-07T10:59:08","guid":{"rendered":"https:\/\/www.sage.com\/en-gb\/blog\/?p=7747"},"modified":"2026-01-29T10:13:30","modified_gmt":"2026-01-29T10:13:30","slug":"a-to-z-of-payroll-guide","status":"publish","type":"post","link":"https:\/\/www.sage.com\/en-gb\/blog\/a-to-z-of-payroll-guide\/","title":{"rendered":"The A to Z of payroll: A guide on terms and concepts to manage payroll"},"content":{"rendered":"<header class=\"entry-header has-dark-background-color entry-header--has-illustration entry-header--has-illustration--generic\">\n\t<div class=\"container\">\n\t\t<div class=\"entry-header__row row align-center\">\n\t\t\t<div class=\"col col-lg-7 col-xlg-6 entry-header__content\">\n\t\t\t\t\t\t\t<div class=\"component component-single-header\">\n\t\t\t\t\t\t\t\t\t\t<div class=\"entry-header__misc text--subtitle text--uppercase text--small\">\n\t\t\t\t\t\t\t<a href=\"https:\/\/www.sage.com\/en-gb\/blog\/category\/money-matters\/\" class=\"entry-header__link\">Money Matters<\/a>\t\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t<div class=\"entry-title-wrapper\">\n\t\t\t\t\t<h1 class=\"entry-title\">\n\t\t\t\t\t\tThe A to Z of payroll: A guide on terms and concepts to manage payroll\t\t\t\t\t<\/h1>\n\t\t\t\t<\/div>\n\n\t\t\t\t\t\t\t\t\t<p class=\"entry-header__description\">\n\t\t\t\t\t\t\t\t\t\t\t<\/p>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t<\/div>\n\n\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t<\/div>\n\t<div class=\"single-post-details container\">\n\t\t<div class=\"col\">\n\t\t\t<span class=\"posted-on \"><time class=\"entry-date published\" datetime=\"2020-07-07T11:59:08+01:00\">7 July, 2020<\/time><\/span><span class=\"reading-time\"> min read<\/span>\n\t\t<button\n\t\t\ttype=\"button\"\n\t\t\tclass=\"social-share-button button button--icon button--secondary js-social-share-button\"\n\t\t\tdata-share-title=\"The A to Z of payroll: A guide on terms and concepts to manage payroll\"\n\t\t\tdata-share-url=\"https:\/\/www.sage.com\/en-gb\/blog\/a-to-z-of-payroll-guide\/\"\n\t\t\tdata-share-text=\"Please read this interesting article\"\n\t\t>\n\t\t\t<span class=\"social-share-button__share-label\">Share<\/span>\n\t\t\t<span class=\"social-share-button__copy-label\" hidden>Copy Link<\/span>\n\t\t\t<span class=\"social-share-button__copy-tooltip\" aria-hidden=\"true\" hidden>Copied<\/span>\n\t\t<\/button>\n\n\t\t\t\t<\/div>\n\t<\/div>\n<\/header>\n\n\n\n<div class=\"wp-block-post-author\">\n\t\t\t<div class=\"co-authors\">\n\t\t\t\n\t\t<div class=\"entry-author-wrapper\">\n\t\t\t<a class=\"entry-author\" href=\"https:\/\/www.sage.com\/en-gb\/blog\/author\/ashleyhindsmansage\/\">\n\t\t\t\t<img loading=\"lazy\" decoding=\"async\" width=\"40\" height=\"40\" src=\"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2025\/02\/Ashley-Thompson-350x350.jpg\" class=\"entry-author__image\" alt=\"Ashley Thompson\" srcset=\"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2025\/02\/Ashley-Thompson-350x350.jpg 350w, https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2025\/02\/Ashley-Thompson.jpg 600w\" sizes=\"auto, (max-width: 40px) 100vw, 40px\" \/>\t\t\t\t<span class=\"entry-author__name\">Ashley Thompson<\/span>\n\t\t\t<\/a>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t<\/div>\n\t\t<\/div>\n\n\n\n<p><span data-contrast=\"auto\">Taking on payroll management responsibilities for a small business introduces a world of new challenges. It also&nbsp;<\/span><span data-contrast=\"auto\">add<\/span><span data-contrast=\"auto\">s a new language of sorts, given all the payroll&nbsp;<\/span><span data-contrast=\"auto\">acronyms<\/span><span data-contrast=\"auto\">.&nbsp;<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">&nbsp;<\/span><\/p>\n\n\n\n<p><span data-contrast=\"auto\">Payroll terminology can be intense to digest if&nbsp;<\/span><span data-contrast=\"auto\">you\u2019re<\/span><span data-contrast=\"auto\">&nbsp;new to the role, and challenging to remember even with payroll experience.&nbsp;<\/span><\/p>\n\n\n\n<p><span data-contrast=\"auto\">Either way, your&nbsp;<\/span><span data-contrast=\"auto\">organisation\u2019s<\/span><span data-contrast=\"auto\">&nbsp;payroll performance requires everyone on the team to have a working knowledge of UK payroll terms.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">&nbsp;<\/span><\/p>\n\n\n\n<div class=\"wp-block-buttons is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link wp-element-button\" href=\"#gate-8c934dee-f3b7-4342-a19f-714d471c3940\">Download your free A-Z of Payroll guide<\/a><\/div>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-understanding-the-basics-of-payroll\">Understanding the basics of payroll<\/h2>\n\n\n\n<p><span data-contrast=\"auto\">First, what is payroll?&nbsp;<\/span><\/p>\n\n\n\n<p><span data-contrast=\"auto\">Payroll<\/span><span data-contrast=\"auto\">&nbsp;is the list of employees and workers a company must pay and the amount they will receive.&nbsp;<\/span><span data-contrast=\"auto\">It\u2019s<\/span><span data-contrast=\"auto\">&nbsp;also the total amount of salaries and wages a company pays to its employees.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\"> Managing it using <a href=\"https:\/\/www.sage.com\/en-gb\/payroll-software\/\">payroll software<\/a> can make life much easier.<\/span><\/p>\n\n\n\n<p><span data-contrast=\"auto\">The payroll function includes:<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">&nbsp;<\/span><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><span data-contrast=\"auto\">Calculating pay for everyone on the payroll<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n\n\n\n<li><span data-contrast=\"auto\">Deducting taxes and legal obligations as required<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n\n\n\n<li><span data-contrast=\"auto\">Distributing pay via che<\/span><span data-contrast=\"auto\">que<\/span><span data-contrast=\"auto\">\u00a0or direct deposit on schedule<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n\n\n\n<li><span data-contrast=\"auto\">Managing record keeping for each employee, including pay year-to-date<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n\n\n\n<li><span data-contrast=\"auto\">Making payroll tax payments and submit<\/span><span data-contrast=\"auto\">ting<\/span><span data-contrast=\"auto\">\u00a0reports on time<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-avoiding-payroll-mistakes\">Avoiding payroll mistakes<\/h2>\n\n\n\n<p><span data-contrast=\"auto\">Quality assurance is vital to payroll performance. Mistakes will happen. Your job is to ensure systems are in place to reduce errors where possible and quickly correct mistakes as they occur. <\/span><\/p>\n\n\n\n<p><span data-contrast=\"auto\">Common errors in UK payroll are:<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">&nbsp;<\/span><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><span data-contrast=\"auto\">Your PAYE bill\u00a0<\/span><span data-contrast=\"auto\">doesn\u2019t<\/span><span data-contrast=\"auto\">\u00a0add up<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n\n\n\n<li><span data-contrast=\"auto\">Mistakes with your full payment submission (FPS) or employer payment summary (EPS)<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n\n\n\n<li><span data-contrast=\"auto\">Paying HMRC an incorrect amount<\/span><\/li>\n\n\n\n<li><span data-contrast=\"auto\">Incorrect employee payments and\/or deductions<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-learn-the-specifics-with-our-a-to-z-guide-to-payroll-terms\">Learn the specifics with our A to Z guide to payroll terms<\/h2>\n\n\n\n<p><span data-contrast=\"auto\">Whether you are new to payroll, or someone on your team is, The A to Z of payroll will take you through the fundamentals to build a solid knowledge base.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">&nbsp;<\/span><\/p>\n\n\n\n<div class=\"single-cta gated-content\">\n\t<div class=\"single-cta__positioner\">\n\t\t<div class=\"single-cta__wrapper has-dark-background-color\">\n\t\t\t<div class=\"single-cta__content\">\n\t\t\t\t\t\t\t\t<h2 class=\"single-cta__title h3\">The comprehensive A-Z guide for payroll professionals<\/h2>\n\n\t\t\t\t\t\t\t\t\t<div class=\"single-cta__description\">\n\t\t\t\t\t\t<p>Learn about the key terms and concepts that will help you to manage the complexities of payroll systems effectively, and to confidently meet compliance requirements.<\/p>\n\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t<a\n\t\t\t\t\t\thref=\"#gate-8c934dee-f3b7-4342-a19f-714d471c3940\"\n\t\t\t\t\t\tclass=\"single-cta__button button button--primary\"\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t>Get your free guide<\/a>\n\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<img decoding=\"async\" width=\"1440\" height=\"810\" src=\"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2022\/04\/GettyImages-1283894303-1440x810.jpg\" class=\"single-cta__image\" alt=\"\" loading=\"lazy\" srcset=\"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2022\/04\/GettyImages-1283894303-1440x810.jpg 1440w\" sizes=\"auto, (min-width: 48em) 33vw, 100vw\" \/>\t\t\t<\/div>\n<\/div>\n\n\n<div class=\"single-cta\">\n\t<div class=\"single-cta__positioner\">\n\t\t<div class=\"single-cta__wrapper has-dark-background-color\">\n\t\t\t<div class=\"single-cta__content\">\n\t\t\t\t\t\t\t\t<h2 class=\"single-cta__title h3\">Subscribe to the Sage Advice newsletter<\/h2>\n\n\t\t\t\t\t\t\t\t\t<div class=\"single-cta__description\">\n\t\t\t\t\t\t<p>Join more than 500,000 UK readers and get the best business admin strategies and tactics, as well as actionable advice to help your company thrive, in your inbox every month.<\/p>\n\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t<a\n\t\t\t\t\t\thref=\"#gate-b1a63862-3fa0-4a5e-bb67-c76b88bbc6b8\"\n\t\t\t\t\t\tclass=\"single-cta__button button button--primary\"\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t>Subscribe now<\/a>\n\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<img decoding=\"async\" width=\"1440\" height=\"810\" src=\"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2022\/04\/GettyImages-1073797282-1-1440x810.jpg\" class=\"single-cta__image\" alt=\"\" loading=\"lazy\" srcset=\"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2022\/04\/GettyImages-1073797282-1-1440x810.jpg 1440w\" sizes=\"auto, (min-width: 48em) 33vw, 100vw\" \/>\t\t\t<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Get your free, comprehensive A to Z of payroll guide to help you understand key terminology and the basics of payroll, so you can confidently meet compliance requirements.<\/p>\n","protected":false},"author":281,"featured_media":11645,"menu_order":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_sage_video":false,"post_featured_image_hide":false,"footnotes":""},"categories":[139,6],"tags":[41,37],"business_type":[4],"lilypad":[],"context":[],"industry":[],"persona":[69,73,74],"imagine_tag":[92,200,103,109],"coauthors":[354],"class_list":["post-7747","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-free-guides-templates","category-money-matters","tag-hr-process","tag-payroll","business_type-small-business"],"sage_meta":{"region":"en-gb","author_name":"Ashley Thompson","featured_image":"https:\/\/www.sage.com\/en-gb\/blog\/wp-content\/uploads\/sites\/10\/2022\/04\/GettyImages-1254783885.jpg","imagine_tags":{"92":"HR and Payroll","200":"Payroll","103":"Payroll software","109":"Small 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