Going from day rate to a salary
Author
Discussion

RockyBalboa

Original Poster:

768 posts

191 months

Friday 6th May 2022
quotequote all
I'm likely to bring on board someone who will be paid a day rate for two days per week for a period of 3 months and then convert to full time at a regular salary.

The accountant should take care of this but they're off at the moment and I just wanted to know how it works from a PAYE paperwork perspective. Does the accountant/payroll simply just enter the day rate into their Payroll system and voila?

Beetnik

577 posts

214 months

Friday 6th May 2022
quotequote all
I can't speak for your accountant but I'd do it as (e.g. works Mondays and Tuesdays):

May:
10 days @ day rate: £200 --> Gross £2,000

June:
8 days @ day rate: £200 --> Gross £1,600

rather than say Salary £1800 each month.

Tax & NICs will vary from month to month dependent on the number of days worked in the month and hence the gross paid.

Countdown

49,519 posts

226 months

Friday 6th May 2022
quotequote all
RockyBalboa said:
I'm likely to bring on board someone who will be paid a day rate for two days per week for a period of 3 months and then convert to full time at a regular salary.

The accountant should take care of this but they're off at the moment and I just wanted to know how it works from a PAYE paperwork perspective. Does the accountant/payroll simply just enter the day rate into their Payroll system and voila?
Assuming they are working a fixed 2 days per week they would just enter them on Payroll as 0.4fte (and then change them to 1.0fte after 3 months)

OutInTheShed

14,693 posts

56 months

Friday 6th May 2022
quotequote all
To me 'day rate' usually implies 'contractor'.

So day rate is often higher because no sick pay, holiday pay etc

So I'd want to be clear if that's the situation or as said above it's 2/5 FTE accruing holiday & pension at 2/5 and all that.