Running payroll seems simple—until you get that dreaded email from HMRC. In 2025, payroll compliance is tighter than ever, and many small business owners in Chessington, Merstham, and across Surrey are struggling to keep up. Missed RTI deadlines, pension enrolment errors, and CIS mistakes can lead to heavy penalties and lost productivity.
This guide covers the top payroll mistakes local businesses make—and how to avoid them with smart systems and the right accounting support.
Why Payroll Accuracy Matters in 2025
Payroll is more than just paying employees—it’s about compliance, trust, and long-term stability.
- Compliance risks: HMRC penalties for late or incorrect RTI filings.
- Cash flow damage: Incorrect PAYE or NIC calculations delay refunds.
- Employee morale: Payment errors hurt staff trust and retention.
- Admin overload: Owners drown in spreadsheets instead of scaling their business.
In Surrey’s competitive landscape, a single payroll slip-up can eat into your margins. Getting it right is non-negotiable.
1️⃣ Missing RTI (Real-Time Information) Deadlines
Every payroll run must be reported to HMRC in real time. Late or incorrect filings trigger instant penalties.
Solution:
- Set fixed pay calendars.
- Automate submissions with RTI-enabled software.
- Always have a backup approver for payroll sign-offs.
2️⃣ Wrong or Outdated Tax Codes
Incorrect codes lead to overpaid or underpaid tax—costly for both employees and employers.
Solution:
- Reconcile HMRC notices regularly.
- Double-check P45/P46 data for new starters.
- Schedule monthly code reviews.
3️⃣ Ignoring Pension Auto-Enrolment
Missing re-enrolment dates or contribution errors can attract fines.
Solution:
- Track staging and re-enrolment dates in your calendar.
- Verify contribution rates every payroll cycle.
- Keep employee communication templates updated.
4️⃣ Poor Record Keeping
HMRC expects complete documentation during audits—payslips, P60s, contracts, and leave records.
Solution:
- Use cloud-based payroll software for storage and access control.
- Follow GDPR standards for employee data.
- Keep digital backups for at least six years.
5️⃣ Manual Payroll in Spreadsheets
Spreadsheets are prone to human error and version confusion.
Solution:
- Move to cloud payroll systems with real-time updates.
- Implement approval workflows and audit trails.
- Use automation to eliminate repetitive manual work.
6️⃣ Misclassifying Workers (Employee vs Contractor)
A wrong classification can cause backdated PAYE liabilities.
Solution:
- Use HMRC’s status checker for each engagement.
- Review contracts and working arrangements.
- For construction, ensure CIS rules are correctly applied.
7️⃣ CIS Deductions Done Incorrectly
In the construction industry, verifying subcontractors and applying the correct deduction rate (20% or 30%) is critical.
Solution:
- Verify subcontractors before payment.
- Auto-generate CIS statements.
- Submit monthly CIS returns on time.
8️⃣ Holiday Pay & Overtime Errors
Irregular hours and rolled-up holiday pay often lead to disputes.
Solution:
- Use clear calculation formulas for hourly workers.
- Sync time-tracking systems with payroll.
- Update employee handbooks regularly.
9️⃣ Not Reconciling Payroll to Accounts
Unreconciled payroll entries distort your financial reports.
Solution:
- Map payroll journals to the correct nominal codes.
- Reconcile the payroll control account monthly.
- Track liabilities for HMRC, pensions, and deductions.
10️⃣ No Backup or Continuity Plan
If your payroll manager is sick or away, who runs payroll?
Solution:
- Document every process in SOPs.
- Cross-train staff or partner with an external accountant.
- Run mock payrolls before deadlines.
Building a Stress-Free Payroll System
A reliable payroll system has four pillars:
Software. Process. People. Compliance.
- Use HMRC-recognised software.
- Create clear roles and backup responsibilities.
- Conduct annual reviews and internal audits.
Why Local Expertise Matters
Chessington’s economy has a unique mix of retail, construction, and service industries—each with specific payroll quirks. Local accountants understand these better than generic online tools.
How Maze Accountants Can Help
At Maze Accountants, we handle everything from payroll setup to HMRC submissions.
- Full payroll management (weekly, monthly, or bi-weekly)
- CIS payroll & returns
- Auto-enrolment compliance
- Cloud access for payslips and reports
- Dedicated payroll support for small businesses
Maze Accountants
📍 Chessington Business Centre, Cox Lane, KT9 1SD, Chessington, Greater London, UK
📍 1 Station Road South, Merstham, Surrey RH1 3EF
📞 +44 20 8643 9633
Don’t let payroll mistakes hurt your business. Contact Maze Accountants today for accurate, compliant, and stress-free payroll solutions that let you focus on growth.
FAQ
❓1. What are the most common payroll mistakes small businesses make?
Common payroll mistakes include incorrect tax codes, late RTI submissions, missing pension enrolments, and misclassifying employees. These errors can lead to HMRC fines and cash flow issues for small businesses in Chessington and Surrey.
❓2. How can I avoid payroll errors in 2025?
The best way to avoid payroll mistakes is by using HMRC-compliant payroll software, setting fixed pay schedules, and working with an experienced accountant like Maze Accountants in Chessington. Automation and expert review ensure accuracy and compliance.
❓3. Do small businesses in Chessington need to submit payroll reports to HMRC?
Yes. Every employer in the UK, including small businesses in Chessington, must report payroll information to HMRC through the Real-Time Information (RTI) system each time employees are paid.
❓4. What are CIS payroll requirements for construction businesses?
Under the Construction Industry Scheme (CIS), contractors must verify subcontractors, apply the correct tax deduction rate (20% or 30%), and submit monthly CIS returns. Maze Accountants can manage CIS payroll and HMRC compliance for you.
❓5. Why should I outsource payroll to a local accountant?
Outsourcing payroll to a local accountant like Maze Accountants saves time, ensures compliance, and reduces the risk of penalties. Local expertise means your payroll meets all UK and Surrey-specific regulations, including pensions and CIS rules.
❓6. How can Maze Accountants help with payroll in Chessington?
Maze Accountants offers full payroll management, including HMRC submissions, pension auto-enrolment, CIS payroll, payslip automation, and dedicated client support — all tailored for Chessington and Surrey businesses.
