Do You Need an Accountant to Do Payroll?

Running payroll can be one of the most time-consuming and error-prone tasks for any business. From calculating PAYE and National Insurance to filing reports with HMRC, it's easy to feel overwhelmed. That's why many business owners ask: “Do I need an accountant to do payroll?”

In this article, we explore whether hiring an accountant for payroll is essential, what's involved in running payroll in London, and the benefits of outsourcing payroll services to a professional accountancy firm like Lawrence Grant.

What Is Payroll and What Does It Involve?

Payroll is the process of paying your employees accurately and on time while staying compliant with UK tax laws. It involves more than just transferring salaries—it also requires:

• Calculating PAYE (Pay As You Earn)
• Deducting National Insurance contributions (NICs)
• Managing pension auto-enrolment
• Reporting to HMRC in real time
• Providing payslips
• Managing benefits-in-kind and student loans

Learn the basics of payroll setup: Payroll Basic Procedures – Lawrence Grant

Understanding Auto-Enrolment and Your Legal Duties

Auto-enrolment is a legal requirement for all UK employers to automatically enrol eligible workers into a qualifying workplace pension scheme and contribute to it. Introduced to help people save for retirement, it's an essential part of running payroll.

As an employer, your responsibilities include:

• Assessing employee eligibility based on age and earnings
• Enrolling qualifying employees into a compliant pension scheme
• Deducting employee contributions and adding employer contributions
• Communicating pension rights to your workers
• Submitting declarations of compliance to The Pensions Regulator

Failing to meet your auto-enrolment duties can lead to fines and enforcement action. That's why many businesses choose to outsource this to professionals.

At Lawrence Grant, we manage the full auto-enrolment process for you—from initial setup and employee assessments to pension deductions and compliance reporting—ensuring you remain fully compliant and penalty-free.

Do You Need an Accountant to Do Payroll?

Legally, no—you don't need an accountant to run payroll. However, many businesses choose to use one because:

• Payroll mistakes can be costly

  Filing errors can lead to HMRC penalties, late payment fines, and employee dissatisfaction.

• RTI (Real-Time Information) is mandatory

  Since 2013, employers must report payroll to HMRC every time they pay an employee. This requires software and up-to-date knowledge of legislation.

  Read more about this here:  Payroll Real-Time Information (RTI)

• Saves time and reduces admin burden

  Outsourcing payroll frees up your team to focus on core operations—especially valuable for SMEs and startups with limited internal resources.

• Helps with compliance and tax planning

  An accountant ensures payroll aligns with your broader financial strategy, helping you stay tax-efficient.

In-House Payroll vs Outsourced Payroll: What's Best?

Why Choose Lawrence Grant for Payroll Services?

At Lawrence Grant, we offer fully managed payroll services tailored to UK businesses of all sizes. Whether you're employing your first staff member or managing a large team, we handle:

• PAYE, NIC, pensions, and student loan deductions
• RTI submissions to HMRC
• End-of-year returns (P60s, P11Ds)
• Holiday and statutory pay tracking
• Full confidentiality and GDPR compliance

Want expert help from day one? Our team can also guide you through initial payroll setup and registration with HMRC.

How Much Does It Cost to Outsource Payroll?

Payroll services are more affordable than most business owners expect. Depending on the number of employees and services required, you can typically expect to pay:

• £100-£200 one off fee to register PAYE scheme
• £25 – £50/month for basic payroll (1–3 employees)
• £75 – £200+/month for larger teams or businesses needing pension processing and reporting

Please note: these prices are not a complete price list as they only refer to the basic payroll service. Additional fees may apply depending on requirements such as for auto enrolment,  payment of net pay to the employees.

Ready to Simplify Your Payroll?

Avoid the risk, stress, and admin time involved in managing payroll yourself. Let the experts at Lawrence Grant Chartered Accountants take care of it for you.

Contact us today for a free payroll consultation.