A-Z Payroll Glossary2024-07-09T12:56:25+00:00

CIS Payroll Glossary

man looking at documents

When choosing CIS as your payroll model, there are lots of abbreviations and terms to take note of. They can be confusing so we have collated a list of CIS terminology for you to refer to whenever you need it.

BACS (Bankers’ Automated Clearing Services)2024-07-09T09:42:33+00:00

The electronic payment system used for transferring salaries and wages to employees’ bank accounts.

Benefits in Kind2024-07-09T09:43:23+00:00

Non-cash benefits provided to employees, such as company cars, private healthcare, and housing, which may be subject to taxation.

CIS (Construction Industry Scheme)2024-07-09T09:44:27+00:00

A scheme designed by HMRC to prevent tax evasion in the construction industry. Contractors deduct money from subcontractors’ payments and pass it to HMRC.

Deductions2024-07-09T09:45:23+00:00

Amounts subtracted from an employee’s gross pay, including income tax, National Insurance contributions, and pension contributions.

Employee Self-Service (ESS)2024-07-09T09:46:19+00:00

A system that allows employees to access and update their personal and payroll information, such as contact details and tax codes.

Gross Pay2024-07-09T09:47:10+00:00

The total amount of money an employee earns before any deductions, including taxes and other withholdings.

Grossing Up2024-07-09T09:50:04+00:00

The process of calculating the gross pay required to achieve a specific net pay amount, taking into account taxes and other deductions.

Minimum Wage2024-07-09T09:51:04+00:00

The minimum hourly wage rates set by the government, which employers are required to pay to eligible employees.

National Insurance (NI)2024-07-09T09:53:38+00:00

A mandatory contribution paid by both employees and employers to fund state benefits, such as healthcare, unemployment benefits, and pensions.

National Living Wage (NLW)2024-07-09T09:54:49+00:00

This applies to workers aged 23 and over. It is set at a higher rate than the National Minimum Wage to reflect the higher cost of living for adults.

National Minimum Wage (NMW)2024-07-09T09:56:45+00:00

This applies to workers under the age of 23 and is set at different rates depending on age and whether the worker is an apprentice. There are specific rates for different age groups: 21-22, 18-20, under 18, and apprentices.

Net Pay2024-07-09T09:59:25+00:00

The amount of money an employee takes home after all deductions, including income tax, National Insurance, and other deductions.

Overtime2024-07-09T10:00:32+00:00

Additional hours worked by employees beyond their regular working hours, often paid at a higher rate than standard pay.

P11D2024-07-09T10:03:49+00:00

A form used to report non-cash benefits, such as company cars and medical insurance, provided to employees by their employer.

P452024-07-09T10:02:55+00:00

A document given to employees when they leave a job, which provides details of their earnings and tax paid during their employment.

P602024-07-09T10:01:17+00:00

An annual document that provides a summary of an employee’s earnings and tax deductions for a specific tax year. It is usually provided by employers at the end of the tax year.

PAYE (Pay As You Earn)2024-07-09T09:52:47+00:00

The system used in the UK for collecting income tax and National Insurance contributions from employees’ salaries by employers.

Pensions Auto-Enrolment2024-07-09T10:06:42+00:00

The legal requirement for employers to automatically enrol eligible employees into a workplace pension scheme and make contributions to it.

Real-Time Information (RTI)2024-07-09T10:09:45+00:00

A system used by employers to report payroll information to HMRC on or before the date of payment, ensuring accurate and up-to-date tax and NI calculations.

Statutory Pay2024-07-09T10:11:45+00:00

Payments made to employees to cover periods of absence due to statutory reasons, including Statutory Sick Pay (SSP), Statutory Maternity Pay (SMP), and Statutory Paternity Pay (SPP).

Tax Code2024-07-09T10:16:09+00:00

A unique code used by HM Revenue and Customs (HMRC) to determine how much income tax should be deducted from an employee’s salary.

Tax Year2024-07-09T10:17:33+00:00

The annual period in which income tax is calculated and collected in the UK, running from April 6th of one year to April 5th of the next year.

Umbrella Payroll2024-07-11T12:53:52+00:00

A payroll model that is often used by agencies to work with contractors via a third party organisation, which acts as the employer for the contractor and handles payroll processing, tax deductions, and other administration tasks.

Bishop Oak works with the
largest organisations on earth

accredited payroll MARSH Commercial
accredited payroll CIPP logo
accredited payroll trust ID logo