Congratulations! You’ve got your first ‘proper’ job. You’re probably excited but nervous at the same time at the prospect of your new-found employment. There will be a lot to learn, but also a wealth of opportunity. Who knows, one day you might be a director of this company? Your new employer will probably, if they haven’t already, ask you to attend a staff induction, which is a course for new employees which introduces them to the business, covers employee relations matters and answers some of your own questions. The induction is used to help acclimatise you to the company and the role. Among the many forms you’ll be asked to provide or complete will be some personal details forms, which include your bank details. These will go to your company’s payroll service. In fact, it’s likely you’ll hear a lot of reference to payroll – it is the function, after all, that makes sure employees’ wages reach their accounts. Paying your salary each month isn’t all that payroll does, however. Here’s how payroll can help you:
By proving your earnings If you were to move into a new rental flat or arrange a mortgage to buy a property, it’s likely you’ll need to provide proof of your earnings. Payroll will be able to issue payslips (if you can’t find your own copies) or refer you to electronic versions to print yourself. In some cases, providing your payslips isn’t enough and payroll may even write a reference to confirm or refer to HR.
By paying your tax When you start, you’ll be asked to provide a P45 a form which details your existing tax code and the amount of tax you’ve paid on any earnings to date. This only applies if you’ve been in paid employment – even just a summer job – in the past. Otherwise, you will be asked to complete a P46 form. Either of these documents will help determine your tax code and thus the rate of tax that you have pay. This code is applied to your payroll information and the payroll team will then make the correct deductions.
By helping you pay off your student loan Many new starters are at the beginning of their professional career, fresh out of college or university. As such, many of them carry the burden of an outstanding student loan which should be paid back once earnings reach a certain level (or at your own discretion). Your payroll team might be able to set up a student loan deduction for you, so that a repayment comes straight out of your salary every month before you’ve had a chance to miss it. This is a great and convenient way to start making your repayments.
By making your pension contributions The payroll team typically handle the staff pension schemes, something that you will probably be invited to join. If you work for a large company, you’ll be included immediately, unless you purposefully opt out. You will receive an employer contribution along with any that you make yourself. If you work for a smaller company, you may need to request your inclusion and might not receive the employer’s contribution yet (rules regarding pension schemes have changed recently and are being rolled out to bigger companies first). Either way, payroll will make the necessary payments on your behalf. Payroll does far more than that and as the years pass, you might find you need them for other reasons, to facilitate parental leave, for example. They are definitely the unsung heroes of the business and people worth being on friendly terms with!
Author Bio: Paul Robinsonis a dedicated writer who has core knowledge regarding the various financial services which are provided by the organizations. Follow him on Google+.