PAYE for Property Management Companies: Employer Obligations

Last updated: April 2026

If your property management operation employs staff - whether property managers, cleaners, or administrative support - you’re likely operating a PAYE scheme. This guide covers your employer obligations.

When PAYE Applies

Basic Rule

PAYE applies if you employ anyone who earns:

• More than £123 per week (2025/26 rates)
• More than £6,396 annually

Common scenarios requiring PAYE in property:

• Property management company with employees
• Multiple property landlords with staff
• Letting agents with employed agents
• Maintenance companies with employees

Not PAYE

Independent contractors are not employees:

• Self-employed tradespeople
• Property managers operating as Ltd companies
• Freelance cleaners (if genuinely self-employed)

Registering as an Employer

Steps to Register

1. Register with HMRC - Within 14 days of first employee
2. Get employer reference - Unique number for payments
3. Set up payroll - Use software or accountant
4. Notify employees - Provide PAYE details

Employer Responsibilities

• Deduct income tax from wages
• Deduct National Insurance (employee and employer)
• Pay to HMRC monthly or quarterly
• Report via Real Time Information (RTI)
• Provide P60 to employees annually

How Payroll Works

Income Tax Deduction

Based on employee tax code:

• Check code on HMRC portal
• Ensure code is correct
• Update for code changes

Employee National Insurance

Employer National Insurance

• 13.8% on employee’s earnings above £175 per week
• Also known as secondary NIC
• No contribution if employee under 21 (under certain conditions)

Real Time Information (RTI) Reporting

What is RTI?

RTI requires you to report PAYE information to HMRC each time you pay employees:

• Weekly or monthly, depending on pay frequency
• Submission due on or before pay date
• Includes all employees paid

Information Required

For each employee:

• National Insurance number
• Tax code
• Gross pay
• Deductions (tax and NIC)
• Net pay

Software Options

• Payroll software (BrightPay, Sage, etc.)
• Accountant handling payroll
• HMRC basic tools (limited)

Deadlines and Payments

Monthly Deadlines

• 22nd of each month if paying electronically
• 17th of each month if paying by post

Annual Requirements

• P60 - Give to each employee by 31 May
• P11D - Report benefits by 6 July
• Final FPS - Submit by 5 April

Common PAYE Mistakes

1. Missing Deadlines

Late payments incur:

• Interest charges
• Penalties
• Potential prosecution for persistent non-compliance

2. Incorrect Calculations

Ensure:

• Tax codes are correct
• NIC calculations accurate
• Benefits properly valued

3. Not Registering

Registering late can result in:

• Penalties
• Backdated PAYE liability
• HMRC scrutiny

4. Wrong Worker Classification

Misclassifying employees as self-employed:

• Large tax bills
• Penalties and interest
• Employment tribunal liability

Related Posts

• Employer NIC for Property Companies - NIC costs
• Pension Auto-Enrolment for Property Managers - Workplace pensions
• Tax Planning for Property - Salary vs dividends

Try HMRC Reporter: https://hmrcreporter.com