Can My Accountant Manage Payroll and Pensions for Me

Hiring staff is a major milestone for any organisation whether it is a business, charity, social enterprise, or community group. It also brings new responsibilities that many new employers underestimate. Payroll and pensions are two of the most important and complex obligations. They must be completed accurately, on time, and in full compliance with HMRC and The Pensions Regulator. Mistakes can be costly and stressful.

Naturally many employers ask the same question. Can my accountant manage payroll and pensions for me

The answer is yes. Most accountants in the UK offer payroll and pensions services. In fact, in my opinion it is one of the most valuable services an accountant can provide because it removes a significant amount of admin and reduces the risk of penalties or staff complaints. This guide explains how accountants manage payroll and pensions, what tasks they take on, what remains the employer’s responsibility, how much support to expect, and how to decide whether outsourcing payroll is right for your organisation.

Why Payroll and Pensions Matter for Every Employer

Before looking at whether accountants can manage payroll and pensions, it helps to understand why these responsibilities matter so much.

Running payroll means:

• Calculating wages correctly

• Deducting tax and National Insurance

• Filing Real Time Information submissions to HMRC on or before payday

• Producing payslips

• Handling student loans and attachment of earnings orders

• Paying HMRC the correct amounts

• Keeping detailed payroll records for at least three years

Managing pensions means:

• Assessing staff for auto enrolment

• Enrolling eligible employees into a pension scheme

• Issuing statutory letters to staff

• Calculating pension contributions

• Filing monthly pension submissions with the provider

• Re-enrolling staff every three years

• Keeping pension records

Failure to meet obligations can result in:

• HMRC fines

• Penalties from The Pensions Regulator

• Overpaid or underpaid staff

• Complaints and loss of trust

• Costly corrections

In my view payroll is one of the most regulated parts of running an organisation. It is easy for mistakes to happen unless the employer has strong systems or professional support.

Can an Accountant Manage Payroll for Me

Yes. Most accountants offer payroll services and many employers choose to outsource all payroll tasks to their accountant. This is especially common among small businesses, new employers, charities, CICs, and organisations without internal HR or finance teams.

What an accountant typically handles

A good accountant can take on the following tasks:

• Setting up the payroll scheme

• Registering the employer with HMRC

• Adding new employees to the system

• Calculating gross and net pay

• Calculating employer National Insurance

• Processing maternity, paternity, and sick pay

• Handling student loans and court orders

• Producing payslips

• Submitting RTI filings on or before payday

• Sending HMRC payment reminders

• Managing starters and leavers

• Preparing P45s and P60s

• Advising on tax codes

• Maintaining payroll records

• Advising on minimum wage requirements

This removes the admin burden from the employer and ensures everything is handled correctly.

Can an Accountant Manage Workplace Pensions for Me

Yes. Many accountants also manage workplace pension duties. Auto enrolment is a legal requirement and applies to all employers who pay staff.

Accountants can handle:

• Setting up the pension scheme

• Assessing staff for eligibility

• Enrolling eligible employees

• Issuing statutory letters to workers

• Calculating pension contributions

• Filing pension submissions

• Handling opt outs and opt ins

• Re-enrolling staff every three years

• Maintaining compliance records

It is important to check whether the accountant includes pension management within their payroll package or charges separately. Some accountants include it as standard. Others treat it as an additional service.

In my opinion outsourcing pension duties is a smart decision because missing even one pension step can trigger enforcement action from The Pensions Regulator.

What Tasks the Employer Must Still Handle

Even when payroll and pensions are outsourced to an accountant, certain responsibilities remain with the employer.

These include:

1. Providing accurate information

The employer must supply:

• Employee details

• Hours worked

• Overtime

• Bonuses

• Commission

• Holiday pay

• Sick leave

• Maternity or paternity leave details

The accountant cannot calculate payroll without this information.

2. Approving payroll

Most accountants will prepare payroll drafts. The employer must sign off before processing.

3. Paying staff

The accountant prepares payroll calculations but cannot physically pay employees unless given access to the bank. Employers remain responsible for funding wage payments.

4. Paying HMRC

The accountant can tell you how much to pay and when. The employer is responsible for making the payment.

5. Paying the pension provider

Again the accountant calculates contributions. The employer must pay the provider unless the accountant is authorised to do so.

6. Maintaining HR records

Payroll does not replace HR responsibilities such as contracts, disciplinary procedures, and onboarding documents.

In other words the accountant handles the compliance and technical side but the employer remains in control.

Benefits of Letting an Accountant Handle Payroll and Pensions

There are several advantages.

1. Reduced risk of mistakes

Payroll errors can cause major problems. Accountants use specialist software that reduces the chance of miscalculations.

2. Compliance with HMRC rules

Accountants understand:

• RTI requirements

• Tax code changes

• National Minimum Wage updates

• Statutory payments

• Student loans

• Attachment of earnings

This keeps the employer compliant.

3. Compliance with pension law

Accountants ensure:

• Staff assessments are correct

• Contributions meet legal minimums

• Statutory letters are issued on time

• Submissions to the pension scheme are filed

• Re-enrolment duties are completed

Auto enrolment penalties can be severe so this support is invaluable.

4. Time savings

Payroll takes time especially for employers who are new to it. Outsourcing frees up hours each month.

5. Clear monthly cost

Payroll services usually come with a predictable monthly fee.

6. Professional advice

Accountants can advise on tax efficient pay structures such as:

• Minimum director salary

• Bonus payments

• Holiday accrual

• Staff benefits

In my opinion these added insights make outsourcing far more valuable than using basic payroll software alone.

What Payroll Software Accountants Use

Most accountants use cloud based payroll software such as:

• BrightPay

• Xero Payroll

• Sage Payroll

• QuickBooks Payroll

• Moneysoft

• IRIS

These systems automate calculations, produce compliant payslips, and integrate with HMRC through RTI. Some also integrate with pension platforms to streamline submissions.

Employers who attempt payroll manually using spreadsheets risk errors and non compliance. Professional software reduces this significantly.

Costs: How Much Does Payroll Management Typically Cost

Payroll fees vary depending on:

• Number of employees

• Whether pensions are included

• Whether the employer needs weekly or monthly payroll

• Whether the accountant handles HR support

• Whether directors are included

Typical UK costs:

For a single director

£10 to £20 per month

For one to five employees

£20 to £60 per month

For six to fifteen employees

£50 to £120 per month

Pension management

Often £5 to £15 extra per employee per month depending on the provider

Set up fees

Some accountants charge a one off fee for:

• Registering with HMRC

• Setting up payroll software

• Setting up pension schemes

In my view the cost is small compared to the risk and time involved in doing payroll yourself.

How Payroll Outsourcing Works Step by Step

Step 1: Provide employee information

The accountant sets up each employee in the payroll system.

Step 2: Send monthly payroll details

Employers provide hours worked, overtime, bonuses, changes, or leave information.

Step 3: Accountant prepares payroll

They calculate:

• Wages

• Deductions

• Employer costs

• Net pay

Step 4: Employer approves

You receive a draft payroll report.

Step 5: RTI submission

The accountant files the submission with HMRC.

Step 6: Payslips issued

Employees receive payslips through email or an online portal.

Step 7: Employer pays staff

Using payroll totals provided by the accountant.

Step 8: Pension contributions submitted

The accountant handles pension reporting unless agreed otherwise.

Step 9: Monthly or quarterly HMRC payments

The employer pays HMRC according to the accountant’s instructions.

Step 10: Year end documents produced

These include:

• P60s

• P11Ds if required

• Year end submissions

All compliance is handled by the accountant.

Common Mistakes Employers Make When Attempting DIY Payroll

Without support employers often struggle with:

• Forgetting RTI deadlines

• Using the wrong tax code

• Miscalculating holiday pay

• Missing workplace pension duties

• Incorrectly processing leavers

• Not applying statutory sick pay correctly

• Not applying maternity or paternity pay rules

• Failing to keep proper payroll records

• Paying staff incorrectly or late

Mistakes can damage staff trust and create costly corrections later.

Can Accountants Handle Payroll for Charities and CICs

Yes. Charities, community interest companies, and social enterprises often rely on accountants for payroll because:

• They recruit part time or sessional staff

• They use volunteers and need clarity on who is classed as an employee

• They rely on grant funding which requires accurate payroll reporting

• They want to avoid payroll mistakes that can jeopardise funding

• They need pension compliance without administrative burden

Payroll for charities may include additional considerations such as:

• Restricted fund reporting

• Project based payroll analysis

• Different employment patterns

• Casual workers

• Seasonal staffing

Accountants with charity experience can manage these complexities effectively.

What to Ask Your Accountant Before Outsourcing Payroll

Before choosing a payroll provider you should ask:

• Does the monthly fee include auto enrolment

• Does the accountant deal with the pension provider

• How should timesheets or hours be submitted

• What deadlines do I need to meet each month

• How will payslips be delivered to staff

• Does the accountant handle P45s and P60s

• Can the accountant deal with statutory payments

• What happens if I need payroll urgently

• How secure is the payroll system

Clarity prevents misunderstandings later.

Situations Where Outsourcing Payroll Is Highly Recommended

In my opinion the following situations make outsourcing especially valuable:

• You have no internal finance staff

• You are a charity or CIC with complex funding rules

• You have more than a few employees

• You run shift work or variable hours

• You have a pension scheme but do not understand re-enrolment

• You want to minimise risk

• You want to focus on running the organisation

• You want to avoid penalties or fines

Payroll mistakes are far more common when employers try to manage everything themselves.

What Happens if Payroll or Pension Duties Are Missed

If payroll duties are missed HMRC may apply:

• Penalties for late RTI submissions

• Interest on late payments

• Penalties for inaccurate payroll

• Compliance checks

If pension duties are missed The Pensions Regulator may issue:

• Compliance notices

• Fixed penalty notices of £400

• Escalating daily fines

• Enforcement action

• Potential legal liability

Having an accountant manage these obligations significantly reduces the risk of penalties.

Real UK Examples

Example 1: Small business hiring first employee

A café hires its first staff member. The owner has never run payroll. The accountant sets up payroll, manages RTI, advises on minimum wage, and handles pensions. The owner avoids fines and payroll runs smoothly.

Example 2: Charity hiring youth workers

A youth charity hires part time workers across several projects. The accountant sets up project code payroll, ensures compliance with grant restrictions, and handles pension enrolments.

Example 3: Growing company scaling to ten staff

The employer had been running payroll manually but errors were increasing. They outsource payroll and pensions to their accountant and errors stop immediately.

Example 4: CIC delivering funded programmes

The CIC must produce payroll evidence for funders. The accountant provides accurate payroll reports which satisfy the funder’s requirements and strengthen the organisation’s credibility.

Final Thoughts

Accountants can absolutely manage payroll and pensions and for most organisations this is one of the most sensible services to outsource. Payroll is time consuming, technical, and heavily regulated. Pensions add an additional layer of legal responsibility which can overwhelm new employers. An accountant ensures everything is done correctly, protects the organisation from penalties, and gives staff confidence in accurate and timely pay.

In my opinion outsourcing payroll and pensions is one of the easiest ways for employers to free up time, reduce stress, and focus on delivering their mission.