44% of employees have paid too much tax as a result of errors in their paycheck
New research identifies a nation confused by payslips, tax codes and who is responsible for taking home the right pay.
London, UK - 2 September 2019
At the start of National Payroll Week1, new research has found that 44% of employees2 – equivalent to approx. 14.3 million people3 across the UK have paid too much tax as a result of being on the wrong tax code or through errors with deductions. Seven per cent of employees (2.8 million) claim to be affected in the past year alone.
The research2 of over 2,000 people in the UK revealed confusion when it comes to understanding the humble payslip:
69% of employees (22.4 million) incorrectly believe it’s not their responsibility to check they’re paying the correct amount of tax
60% of employees (13 million) don’t realise having multiple jobs affects their tax
18% of employees (5.9 million) don’t even check their payslip
7% of employees (2.8 million) believe everyone pays the same tax, regardless of personal situation
Complex circumstances
Almost a quarter (23%) of all employees have four or more regular deductions from their gross pay, such as travel loans, childcare vouchers, student loans, gym memberships and medical insurance. With all of these impacting the tax code a worker should be on at any point in the year, it is not surprising that both employees and business owners can struggle to get this right every time.
Shaun Shirazian, Head of Product at Intuit QuickBooks UK, who conducted the research said: “Many of us can feel a bit lost when checking our payslips and feel unsure about the multiple factors that contribute to our adjusted pay. Taxes are complex and the research shows that significant overpaying of tax is caused by payroll issues, such as being on the wrong tax code, or errors with deductions such as childcare vouchers.”
The research further found that overpaying tax due to payroll issues was just as prevalent across employees of companies of all sizes, but employees of smaller businesses are far less likely to even check their payslip for mistakes.
Shirazian added, “Small businesses in particular have many different areas of a business to manage, often with limited support in terms of man-power. They want to get pay right for their employees but – as this research shows – there are sometimes a multitude of challenges in ensuring this is watertight. We want to be able to give these business owners the tools and support they need to help their employees get paid properly and accurately.”
The recently launched QuickBooks Advanced Payroll solution gives employers the ability to automatically account for benefits like childcare vouchers when running payroll. It also provides an online employee portal, simplifying the process for employees looking to check and understand their payslip.
For more information on payroll and to better understand payslips, please visit QuickBooks, or visit gov.uk/tax-codes for more information about tax codes
Sources
1 National Payroll Week 2019 (2-6 Sep) is organised by CIPP and celebrating its 21st year
2 Independent research conducted by Opinium on behalf of Intuit QuickBooks with a nationally representative sample of 2,006 UK adults in August 2019.
3 Calculations are approx.. based on 32.8 million working adults in the UK, source: ONS Labour Market overview, Aug 2019
Intuit QuickBooks is offering an introductory offer for the new QuickBooks Advanced Payroll to small business owners and accountants, at £1 per paid employee per month, until 15 November 2019. Full details and terms can be found here
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