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The recent announcement by H M Revenue & Customs concerning Pay As You Earn (PAYE) problems is not good news for the staff in payroll and Human Resources who deal with queries from their employees. It is expected that it will take at least six months for this issue to be sorted out, and it is the employers rather than the Revenue who will have to do the brunt of the clearing up.

It is no wonder that many accountancy firms are offering payroll operation as one of their core services. In fact, online accountants with the latest software have revolutionised this area. They are able to offer a complete payroll service and the cost usually works out  less than doing it in-house particularly when indirect costs are taken into account.

The advantages of using an accountancy firm for payroll includes the fact that their staff will have dealt with most situations that arise before meaning they can deal with them far quicker than someone who only deals with such problems on an occasional basis.

The tax legislation, especially for PAYE, seems to become more complex every year. In addition to this, HMRC regularly adjusts the way in which it operates the legislation. This means it can cost a fortune in training courses, and subscriptions to handbooks and technical journals. Even if the investment is made, it is often doubtful whether the staff involved have the time to keep pace with all the changes especially if some of the rules will only apply rarely.

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