If you are anything like me, every month when it’s time to make a payroll tax payment to HMRC, you likely find yourself double-checking (or maybe even triple-checking!) which reference number to put on your payment. I know what you’re thinking, “Using the correct PAYE reference is boring”, and it is, but it’s important if you want to avoid chaos on your account later!
Like with everything we do at JVCA, the friendly accountants, we aim to make your life easier. So this is what this brief article is all about. Here is what you need to figure out the right reference for each payment and why it matters, so you can make sure that HMRC isn’t left guessing (because they’re not always great at that!).
Why getting the PAYE reference number right matters
Here’s the thing: if you put the wrong PAYE reference number, HMRC might misallocate your payment, meaning it could end up in the wrong place and cause you a world of avoidable trouble. For example, a misplaced payment can lead to interest charges or, even worse, being chased for payments that you have already made.
Long story short, using the right reference lets you keep control and helps ensure HMRC is happily in the loop.
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The structure of your PAYE reference number
So, HMRC hands you a 12-digit reference number for your payroll account. It usually looks something like 123AB45678910, and this reference just gets it onto your account. To tell HMRC which month and tax year this relates to, you add the number of the year and the month in the format YYMM onto the end.
Sounds straightforward, right? The only thing to remember is HMRC operates on a tax year/month combo rather than a calendar one. For example, April 2024 is considered the first month of the 2024/2025 tax year, not the fourth month of the calendar year. This means the tax year is 25 and the tax month is 01 …which is not confusing at all is it?
PAYE payment codes for each month in 2024-25
To make your life a whole lot easier, here is a list of the 4 digits to put at the end of your PAYE payment reference for the 2024/25 tax year:
- April 2024: 2501
- May 2024: 2502
- June 2024: 2503
- July 2024: 2504
- August 2024: 2505
- September 2024: 2506
- October 2024: 2507
- November 2024: 2508
- December 2024: 2509
- January 2025: 2510
- February 2025: 2511
- March 2025: 2512
Remember, PAYE payments are due by the 19th of the following month, or by the 22nd if you pay electronically. Keeping on top of deadlines, in addition to using the correct reference, helps you avoid late fees or potential penalties from HMRC. It’s all about making things as smooth as possible!
Special PAYE reference for P11D or Benefit in Kind payments
For P11D or benefit-in-kind payments, you’ll want a different code altogether. Let’s say you’re paying the Class 1A charge for your 2024/25 P11Ds, the reference would end in 2513. That final 13 signifies that this is a “month” outside the usual payroll sequence, making it easy for HMRC to know you’re handling benefits rather than a regular payroll.
What to do if you’ve used the wrong reference number
Mistakes happen! If you’ve accidentally used the wrong reference number, it’s essential to act quickly to ensure HMRC allocated the payment correctly. Contact HMRC’s helpline as soon as possible to explain the situation. They can usually reassign the payment once they know the correct details.
If sorting out payment issues feels overwhelming, remember that JVCA is here to help. We can liaise with HMRC on your behalf to ensure your accounts stay in order, saving you time and helping you avoid penalties.
Get HMRC to work with you, not against you
Hopefully, I have shed a little light on what can be a confusing part of managing payroll. By getting these reference numbers right, you’re helping HMRC direct your payments precisely where they should go, keeping your account hassle-free and your sanity intact!
Remember, JVCA is here to make your life easier, so if you need help filing, communicating with HMRC, translating things into plain English, or resolving any issues, get in touch.
