Payroll isn’t just about getting numbers right on a spreadsheet — it’s about trust, compliance, and protecting your reputation. Even small mistakes, like miscalculating hours or missing an auto-enrolment deadline, can have big consequences: damaging employee confidence, triggering HMRC penalties, and creating unnecessary stress for business owners.
Research shows how common these issues are: of 1,000 small businesses surveyed, 48% made incorrect wage calculations, 38% made late or missed payments, 36% processed incorrect hours, and 27% used incorrect tax calculations. With so much at stake, it’s essential for employers to take a proactive approach to payroll.
Keep compliance front and centre
Payroll errors aren’t just inconvenient — they can lead to fines, legal action, and reputational damage. Staying compliant means:
- accurate reporting to HMRC and The Pensions Regulator
- secure, GDPR-compliant systems with proper disaster recovery in place
- well-trained teams who understand the latest legislation
When payroll is accurate and compliant, it protects both your people and your business.
Avoid national minimum wage mistakes
National Minimum Wage (NMW) compliance is a frequent problem area. Errors can arise from:
- allowing deductions (for uniforms, accommodation, or salary sacrifice) that reduce pay below the legal threshold
- misclassifying workers or missing changes to age bands and rates
- not paying for all working time, including training, travel between assignments, or preparation time
- rounding down hours or counting tips towards minimum wage calculations
These mistakes may seem small but risk penalties and reputational damage.
Get auto-enrolment right
Auto-enrolment errors can cause significant compliance issues. Risks include:
- incorrectly assessing employee eligibility or applying the wrong salary/age bands
- using the wrong earnings basis (qualifying vs pensionable earnings)
- missing re-enrolment deadlines or failing to issue statutory communications
- using software without auto-enrolment features or failing to update employee data
Accurate pension contributions are essential for both employee trust and legal compliance.
Embrace technology
Modern payroll technology helps businesses reduce risk and streamline processes, delivering payroll that’s more accurate and fully transparent.
Beyond reducing admin, it also enhances the employee experience, giving staff instant access to payslips, pension details, and other key information.
Plan ahead and seek expert support
Payroll should never be an afterthought. From budgeting for wage increases to preparing for new legislation, forward planning ensures you’re in control. Many businesses choose to outsource payroll, gaining peace of mind from expert oversight and freeing up time to focus on running the business.
The bottom line: Payroll done well builds trust, supports compliance, and protects your reputation. Payroll done poorly risks fines, unhappy employees, and costly mistakes.
To support employers, we’ve created two free resources to help ensure you stay ahead and remain compliant with your payroll:
- Payroll benefits in kind road map
- Employer’s guide to mandatory payrolling of benefits in kind
Contact Whitley Stimpson payroll team
Outsourcing your payroll to Whitley Stimpson means you can focus on your business while we manage your payroll, ensuring your payroll is accurate and fully compliant
Looking ahead: From April 2027, payrolling of Benefits in Kind will become mandatory. Employers who prepare early will be well-placed to ensure a smooth transition and avoid disruption. Our team is here to help you get ready.
Contact Tracy Gill, Payroll Manager at TracyG@whitleystimpson.co.uk.