PAYE

In recruiter context

Your employer uses your tax code to deduct income tax and National Insurance every payday and sends the money to HMRC. Most UK employees never have to file a Self Assessment because PAYE handles it for them. PAYE goes wrong when your code is incorrect (especially after job changes, bonuses, or benefit-in-kind changes) — that's when you over- or under-pay tax and only find out via the P800 reconciliation in May/June. Always check your tax code on your first payslip at a new job. Employers are required to operate PAYE for any role paying above the Lower Earnings Limit (£123/week as of 2025).