This glossary explains common payroll terms used in Cintra People Payroll.
Term | Definition |
|---|---|
AEO (Attachment of Earnings Order) | A court order requiring an employer to deduct money from an employee's wages to pay debts, such as council tax arrears or child maintenance. |
Auto-enrolment | The legal requirement for employers to automatically enrol eligible employees into a workplace pension scheme. Also known as automatic enrolment. |
BACS (Bankers' Automated Clearing Services) | The system used to transfer wages electronically into employees' bank accounts on payday. |
Basic pay | An employee's standard salary or wages before any additions (such as overtime or bonuses) or deductions (such as tax or pension contributions). |
Class 1 National Insurance | National Insurance contributions paid by employees and employers on earnings from employment. |
Company car | A vehicle provided by an employer for an employee's use. This is a taxable benefit that must be reported to HMRC. |
Contractual hours | The number of hours an employee is contracted to work, as stated in their employment contract. |
Deduction | An amount subtracted from an employee's gross pay, such as tax, National Insurance, pension contributions, or student loan repayments. |
DEO (Deductions from Earnings Order) | Similar to an AEO, a court order requiring an employer to deduct money from wages to pay specific debts. |
EPS (Employer Payment Summary) | A submission to HMRC used to reclaim statutory payments (such as Statutory Maternity Pay) or report that no employees were paid in a tax month. |
Employment ID | A unique identifier assigned to each employee in Cintra People Payroll. |
FPS (Full Payment Submission) | A Real Time Information (RTI) submission sent to HMRC on or before each payday, reporting what employees have been paid and what deductions have been made. |
FTE (Full Time Equivalent) | A measure of an employee's working hours compared to a full-time employee. For example, someone working 20 hours per week when full-time is 40 hours has an FTE of 0.5. |
Gross pay | An employee's total pay before any deductions (tax, National Insurance, pensions, etc.) are taken off. |
HMRC (His Majesty's Revenue and Customs) | The UK government department responsible for collecting taxes, including PAYE and National Insurance. |
Leaver | An employee who has left the organisation. Their final pay and P45 must be processed correctly. |
Net pay | The amount an employee receives after all deductions have been taken from their gross pay. This is the amount paid into their bank account. |
NI (National Insurance) | Contributions paid by employees and employers to qualify for certain state benefits and the State Pension. |
NI category | A letter code (such as A, B, C, or M) that determines how much National Insurance is paid. The most common category for standard employees is Category A. |
NMW (National Minimum Wage) | The minimum hourly rate that must be paid to workers, which varies by age. The highest rate (for workers aged 21 and over) is also known as the National Living Wage. |
P11D | An annual form submitted to HMRC detailing expenses and benefits provided to employees, such as company cars or private medical insurance. |
P45 | A document given to an employee when they leave a job, showing how much they've earned and how much tax has been paid in the tax year. |
P60 | An annual certificate showing an employee's total pay and deductions for the tax year (6 April to 5 April). Issued to all employees at the end of each tax year. |
Pay period | The frequency with which employees are paid (for example, weekly, fortnightly, four-weekly, or monthly). |
Pay reference | A unique identifier for each pay period within a payroll (for example, 2026/01 for the first pay period of 2026). |
Payroll | A group of employees who are paid together on the same schedule. Organisations can run multiple payrolls (for example, separate weekly and monthly payrolls). |
Payslip | A document showing an employee's pay, deductions, and net pay for a specific pay period. |
Pension scheme | A workplace pension arrangement where both the employee and employer contribute towards the employee's retirement savings. |
Pensionable pay | The earnings on which pension contributions are calculated. This may differ from gross pay depending on the pension scheme rules. |
RTI (Real Time Information) | The system for reporting PAYE information to HMRC on or before each payday, usually through an FPS submission. |
Salary sacrifice | An arrangement where an employee gives up part of their salary in exchange for a non-cash benefit (such as additional pension contributions or a cycle-to-work scheme). This can reduce tax and National Insurance. |
SMP (Statutory Maternity Pay) | Pay that eligible employees receive during maternity leave, funded partly by the employer and partly reclaimed from HMRC. |
SPP (Statutory Paternity Pay) | Pay that eligible employees receive during paternity leave. |
SSP (Statutory Sick Pay) | The minimum amount employers must pay to eligible employees who are off work due to illness for four or more consecutive days. |
Starter checklist | A form completed by new employees to help determine their correct tax code. This replaced the P46 form. |
Student loan | Deductions taken from an employee's pay to repay their student loan. There are different plan types (Plan 1, Plan 2, Plan 4, Plan 5, Postgraduate Loan) with different thresholds. |
Tax code | A code issued by HMRC that tells an employer how much tax to deduct from an employee's pay. Common codes include numbers followed by L (such as 1257L). |
Tax year | The 12-month period from 6 April to 5 April the following year, used for calculating income tax and National Insurance. |
Year-end | The end of the tax year (5 April), when final submissions are made to HMRC and P60s are issued to employees. |
YTD (Year To Date) | The cumulative total of pay or deductions from the start of the tax year to the current pay period. |