Most entrepreneurs don’t forget to pay their staff. But what often slips through the cracks is something far less obvious— making the PAYE payment to HMRC within time.
With so much focus on business and payroll, one can, at times, forget the PAYE deadline or use the wrong reference. The result? Late fees, unwanted HMRC attention, and a payment record that could appear suspicious in the future.
If you think online payments mean that you are in the clear, it might be time for a reality check.
What Happens When You Miss the PAYE Payment
You may not notice the mistake right away, but penalties do accumulate.
HMRC charges interest on unpaid PAYE from the day following the deadline. If your business misses more than one deadline during a tax year, a late payment penalty is charged— 1% of the amount owed and higher for repeated offenses.
But the real impact is much worse. Regularly making mistakes or getting PAYE wrong in reporting can lead to an HMRC compliance check or visit—one that no business owner wants.
The Common Failings (and Why They Keep Coming Back)
Most PAYE errors are not intentional. They can be small things like:
- Getting the incorrect payment reference (yes, that 13-digit number does matter)
- Believing weekends or bank holidays are not included when payment due dates come around
- Forgetting to submit the RTI (Real Time Information) return in time
- Pay out of an incorrect account or using a slow channel
Even if it’s a same-day payment, something may go wrong if the reference is not entered correctly. HMRC’s systems don’t make guesses— you either paid appropriately, or you didn’t.
Why “Online” Doesn’t Mean “Automated”
Most employers believe that if payroll is computerised, the tax payments are also taken care of automatically. But that is rarely the case unless you have a direct debit setup or integrated service.
The reality? You normally pay PAYE online by hand and recheck the reference and timing.
Just because it’s online, doesn’t make it totally foolproof. Unlike direct debit payment on bills, PAYE needs more attention.
How UK Property Accountants Keep You from All This
If you’re already managing property, staff, and compliance duties, keeping PAYE right each month can feel like a nightmare.
UK Property Accountants give you complete payroll and PAYE services, so that your maths is accurate, deadlines are hit, and payments traceable and compliant. No estimation, no missing references, and no shocks from HMRC.
They keep things organised so that your records stay neat—and your business runs more efficiently.
Conclusion: Prevention is Always Cheaper Than a Penalty
The truth is, it can be way more expensive to correct a PAYE mistake than to do it right from the start.
When you pay PAYE online, you’re not just sending money— you’re informing HMRC that your business has its finances in order. A delayed payment might not matter now, but down the line, it can be a big worry.
If you’re a small business or have several employees to look after, pay attention to PAYE and incorporate it into a broader, more consistent tax approach.
How to Calculate VAT: A No-Fuss Guide for Online Sellers
If you run an online store in the UK, figuring out VAT can feel like learning a second language. Between percentages, thresholds, and ever-changing rules, it is easy to get overwhelmed. But understanding how to calculate VAT is essential if you want to run a smooth operation—and stay on the right side of HMRC.
Whether you’re new to the game or want to double-check your numbers, this guide breaks down the process into simple steps. And if you’re looking for a shortcut, the free online UK VAT calculator by FigsFlow might be the tool you didn’t know you needed.
What is VAT?
Let’s start with the basics. VAT stands for Value Added Tax. It is a type of consumption tax added to most goods and services in the UK. If your business is VAT-registered, you collect this tax on behalf of the government and then pass it on to HMRC.
At its core, VAT is not meant to be a cost to your business. You charge it to your customers, pay it to your suppliers, and then settle the difference with HMRC. But to do that correctly, you need to know how to calculate it in the first place.
When Do You Need to Register?
If your taxable turnover crosses £90,000 in a 12-month period (as of 2025), you are legally required to register for VAT. Some sellers register earlier—either to claim VAT back on business expenses or to look more professional to clients.
Once you are registered, everything changes. You need to start charging VAT on your sales, submit VAT returns, and keep digital records under Making Tax Digital rules.
VAT Rates in the UK
There are three main VAT rates to keep in mind:
- Standard rate (20%) – Applies to most goods and services.
- Reduced rate (5%) – Used for things like home energy or children’s car seats.
- Zero rate (0%) – For products such as most food, books, and children’s clothing.
Online sellers usually deal with the standard rate. If you sell internationally, things can get trickier—but let’s keep things simple for now.
How to Calculate VAT
Here’s how the math works:
- Adding VAT to a price
If you are selling a product for £100 and want to add 20% VAT, multiply by 1.20:
£100 × 1.20 = £120 (VAT-inclusive price)
- Finding VAT from a VAT-inclusive price
If you are working with a price that already includes VAT, divide by 1.20 to find the net:
£120 ÷ 1.20 = £100
Then subtract:
£120 – £100 = £20 (VAT amount)
This is where mistakes often creep in, especially when you are juggling dozens of invoices, returns, and expenses.
A Smarter Way: Try a Free Online UK VAT Calculator
You can crunch these numbers by hand or use a spreadsheet, but there’s an easier option. FigsFlow’s free online UK VAT calculator does heavy lifting for you.
Pop in your numbers—net price or gross, whichever you have—and the calculator instantly shows you the breakdown: net price, VAT amount, and VAT-inclusive total. You can even switch between standard, reduced, and zero rates with a click.
It is fast, accurate, and always up-to-date with the latest tax rules. Whether you are quoting a price to a customer or double-checking figures on your VAT return, it is a tool you’ll want close by.
Why It Matters for Online Sellers
If you are selling through platforms like Shopify, Etsy, or Amazon, VAT is not optional. It affects your pricing, your margins, and how your products appear to buyers. Miscalculate it, and you could end up undercharging customers—or worse, owing HMRC more than you thought.
Many sellers fall into the trap of guessing VAT or copying what their competitors are doing. That might work for a while, but it’s a risky approach. HMRC does not have much patience for mistakes, whether intentional or accidental.
Using a free VAT calculator can help you stay compliant, avoid errors, and keep your business running smoothly. It’s one of those small tools that quietly saves you hours.
VAT Returns Without the Headache
Once you are VAT-registered, you are required to file VAT returns quarterly. That means reporting what VAT you charged customers, what you paid suppliers, and what you owe HMRC (or what they owe you).
FigsFlow goes beyond a calculator. It is part of a full toolkit that helps small businesses stay on top of proposals, pricing, and tax compliance. Their VAT tools are designed with online sellers in mind—simple, fast, and built for real life.
If you are tired of wrestling with spreadsheets or worried about missing a deadline, it might be time to level up.
Keep It Simple, Keep It Legal
VAT can feel like a minefield, but it doesn’t have to be. Once you understand the basics and have the right tools in place, you can handle it with confidence.
So whether you are updating your product listings, preparing your next invoice, or checking last month’s sales, remember there is no shame in getting help from a calculator.
Give FigsFlow’s free online UK VAT calculator a try and see how much smoother your day-to-day accounting can be. It is one less thing to stress about—and one more way to stay focused on growing your business.