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HMRC internal manual

PAYE Manual

HM Revenue & Customs
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PAYE operation: payments for PAYE purposes: introduction

The PAYE regulations set out how an employer who makes payments of PAYE income is required to deduct and account for the income tax due.

PAYE income consists of

  • Employment income
  • Pension income
  • Social security income

This section of the Manual is concerned with the taxation of payments of PAYE income.

The Employer Further Guide to PAYE and NICs (booklet CWG2) also gives a detailed list of the kinds of payment that count as pay for PAYE purposes. It covers

  • Payments made by cash or cheque
  • Credits made to the employee’s bank or building society account
  • Credits made to an account in the employer’s name but from which the employee can draw
  • Amounts voted to a director and credited to an account from which the director can draw
  • Some non-cash pay such as vouchers or credit tokens
  • Payments in the form of readily convertible assets