If you are operating as a Limited Company , you are an employee of the company paid a salary (exactly how much you decide to pay yourself as salary is a different subject). You may also wish to pay salaries to other family members, or indeed other employees.

This involves a lot of complicated calculations with Income Tax and National Insurance Contributions (NIC) (especially for directors). Independence takes care of all this for you. You simply enter each employee's tax code (and any amendments received during the year) and the normal monthly salary.

This screen shot gives you an idea of what it will look like.

The year to date history is shown in the top half, and this month's salary at the foot. Until the 'yes' button is pressed, it is only provisional and several different amounts can be tried e.g. when the employer's NICs start to bite. When the 'yes' button is pressed, you record the payment details. All the different circumstances are catered for including the dreaded 'K' codes.

The details are now stored ready to pay over the tax at the end of the quarter and for the PAYE returns at the end of the quarter and end of tax year.

Recognise this form ? It's looks very like the one you should be sending each month or quarter with your cheque to the Inland Revenue. 

This is how Independence™ presents the figures to you when you click on the Reminder or select 'Pay Over' from the menu. You can choose to pay either monthly or (more likely) quarterly and all you have to do is copy the figures onto the form and write a cheque.

The figures are recorded for the Inland Revenue form P32 (Record of Payments by Employer) and carried onto the P35 End of Year return.

To help decide how much to pay per month (especially if you want to keep someone below the NIC threshold) you can use the Income Tax and NIC Illustration.

At the end of each tax year on the 6th of April, you have to carry out a reconciliation between the amounts of Income Tax and National Insurance Contributions which you have deducted from employee's pay and the amounts which you have paid over to the Inland Revenue. You also have to complete and return various forms.

Independence™ takes care of all of this for you, providing facsimiles of the official forms with all the figures on so that you can just copy them across (in the case of P14/60 you can print directly onto the LaserSheets provided by Inland Revenue). Estimated time one hour absolute maximum. In a future version it will (optionally) submit these forms electronically.

It also remembers the amount of Class 1a National Insurance Contributions due on company cars.