Course

Overview

The Level III Diploma in Payroll Management covers the theoretical knowledge and demonstration of the use of various tables and publications issued by HMRC and the demonstration of how to carry out computerised handling of payroll related matters.

Payroll Administrator Level 3

Payroll Administrator  Module 1 

Topic 1 

Underpinning Knowledge

1.1 Demonstrate knowledge and understanding of the theory of payroll

  • Demonstrate a basic understanding of the law relating to payroll, discrimination, employment status, data protection and confidentiality.

  • Understand and explain the legislation for PAYE and National Insurance Contributions (NICs) 

  •  Understand and explain the requirements of the Working Time Directive  Demonstrate an understanding of the Statutory Minimum Wage  

  • Demonstrate an awareness of the legislation concerning the provision of a pension scheme and the different types of pension schemes together with the effect they may have on PAYE and NI deductions

  • Demonstrate understanding of the schedule of submissions to HMRC under the "Real Time Information" (RTI) scheme

  • Understand how a business may receive recompense for statutory payments including the effect of Small Employer's Relief and when this may be applied

  • Understand what information must be submitted to HMRC and the relevant deadlines that apply

Topic 2 

Calculation of Gross Pay

2.1 Demonstrate knowledge and understanding of, and be able to calculate, the various payments that can make up an employee's Gross Pay

  • Calculate the correct gross pay for each pay period for employees who are paid an annual salary, weekly wage, hourly pay, overtime, piecework and bonuses including statutory payments when appropriate

  • Understand and explain statutory payments of sickness, maternity, paternity and adoption pay 

  • Understand the procedures to use when an employee is paid in advance for a period to be taken as paid holiday

Topic 3

National Insurance Contributions

3.1 Show knowledge and understanding of, and be able to calculate through the use of tables the amount of National Insurance Contributions that will be deducted from gross pay

  • Understand and explain the difference between contracted in and contracted out NI contributions

  • Use appropriate tables/calculators to determine the NI contributions for a gross pay figure

  • Using the current legislation, calculate the NI contributions

  • Be able to correctly calculate the NICs for an employee being paid for periods (such as holidays) in advance

Topic 4

Pay As You Earn

4.1 Show knowledge and understanding of the concept of PAYE, together with the use of tax codes to correctly calculate the amount of PAYE to be deducted in a given period

  • Understand how tax codes are calculated and applied

  • Given a tax code to be applied, be able to calculate the amount of free pay that an employee may earn in any given period 

  •  Determine the amount of pay that is taxable for an employee with a given tax code 

  •  Determine the correct amount of PAYE to be deducted for a given period

  • Calculate the amount of PAYE to be deducted when an employee is being paid in advance

  • Understand how to deal with notifications of change in tax code issued by HMRC (Forms P6 and P9)

Topic 5

Other Statutory deductions

 5.1 Show knowledge and understanding of other statutory deductions that can be applied to an employee's pay

  • Demonstrate understanding of the process used to repay student loans

  • Determine the correct deduction towards repayment of a student loan

  • Understand when and how an attachment of earnings may be used

Topic 6

Directors

 6.1 Show knowledge of the rules applying to directors in a payroll situation

  • Demonstrate understanding of the requirement for directors NI deductions to be treated differently from ordinary employees

  • Correctly calculate the NI deductions for directors using the "Non-Cumulative" ("Alternative" or "Table method") and the "Cumulative Director method

Topic 7

Benefits in Kind (BIK)

 7.1 Demonstrate a knowledge of the rules regarding benefits in kind

  • Understand the concept of BIK and the impact it has on an employee's pay and their employer's costs

  • Calculate the appropriate costs and deductions for tax purposes when an employee is provided with the following benefits by their employer: company car, private fuel, loan, private health insurance, other common basic benefits assuming all required details are provided

  • Understand how to complete all relevant forms with details relating to the above benefits and the deadlines by which they must be submitted

  • Understand the relevant of payrolling benefits in kind

  • Understand the effect of recovering tax due through a change of tax code

Topic 8

Construction Industry Scheme

 8.1 Demonstrate a knowledge of the rules governing the payment and deductions that apply to contractors and sub-contractors within the Construction Industry

  • Understand and explain the basic principles behind the Construction Industry Scheme (CIS).

  • Understand the duties of a contractor to verify subcontractors

  • Correctly calculate the amount of tax to be deducted if applicable

  • Understand how to make appropriate adjustments to payments to HMRC for CIS tax

  • Accurately complete relevant forms at month-end for a contractor and a sub-contractor business in the construction industry

  • Understand the duties of a sub-contractor to submit relevant invoices within appropriate timescales

  • Explain why tax may be deducted at source from such an invoice

  • Understand the different methods of reclaiming tax deducted depending on the legal entity of the business (ie sole trader v limited company)

Topic 9

Use of Payroll Forms

 9.1 Understand the use of the various forms that are used within a payroll system

  • Understand when and how to complete a P45 form and where each part should be sent / stored

  • Demonstrate an understanding of how a starter checklist form is completed and used

  • Demonstrate an understanding of the use of form P11 with payments and deductions for directors and regular employees on various payment schedules, statutory requirements and with differing tax codes including when payments are being made in advance

  • Accurately produce a P60 form at year-end for each employee

  • Demonstrate an awareness of all other relevant payroll forms

Topic 10

Demonstrate practical skills in the application of a payroll package

10.1 Understand and be able to complete the various forms that apply to a business running a payroll system

  • Utilising knowledge of the theory of payroll, demonstrate a full understanding of a sophisticated payroll package by installing, setting up, configuring and using it to produce accurate, comprehensive reports from a range of payroll scenarios encountered in a business of up to 10 employees.

  • Set up the details of a new business including appropriate company and existing employee details. Some existing or new employees may be directors who undertake to have their NI deducted using different methods or employees who work irregular hours. Enter and process payroll for a variety of different pay periods and produce reports detailing gross pay, deductions and net pay for each period

  • To adequately secure the business' payroll data, carry out periodic back-ups of payroll-related information.

  • Produce summary reports for defined periods

  • Perform the necessary actions within the software to handle an employee leaving and produce the required documentation

  • Configure a new employee within the software according to information provided  

  • Where possible, carry out or simulate a month end procedure under RTI and produce a number of required reports including potential adjustments resulting from CIS deductions and any other recoverable amounts. Note: under the new RTI scheme it is impossible to produce the month end information unless you are using a live business. Be prepared to be able to show what information would be submitted or to explain how this would work Note: the 'Basic PAYE Tools' package provided by HMRC does not offer the level of sophistication required to cover this part of the syllabus.

Learning & Assessment

 

This Apprenticeship will last for 15 months, with the Apprentice coming into their local Academy throughout the programme. In these sessions, there will be masterclasses held by industry experts as well as visits to the workplace every 8-12 weeks.

Towards the end of the apprenticeship the knowledge, skills and behaviours of the apprentice will be tested in the following ways:

  • Multiple-Choice

  • Role simulation

  • Personal Discussion

 
 

Progress House

4 Siddals Road

Derby

DE1 2PW

T: 01332 371 666

E: info@ematraining.co.uk