Skip to main content Payroll acronym buster: abbreviations and keywords explained
Can you tell your EPS from your EYU and your SAP from your SMP? If the alphabet soup of payroll acronyms has you scratching your head, you are very much not alone. We’re here to help you understand the key concepts hiding behind those letters.
CIS
Many contractors and subcontractors working in the construction industry must register for this scheme, under which the contractor may be required to deduct income tax from the subcontractor’s bills and pay that tax to HMRC.
EPS
One of two reports sent to HMRC as part of RTI payroll. The EPS will be sent alone if no employees are being paid in that pay period. It may also be sent to report statutory pay, CIS deductions, and certain reliefs such as the Employment Allowance.
EYU
For the payroll year 2019/20, an EYU could be sent to report payroll errors in a prior tax year. HMRC now asks for an amended FPS to be sent instead of an EYU.
FPS
The other report regularly sent to HMRC as part of RTI payroll. It reports how much the employer is paying in wages, to whom, and what tax and NI HMRC should expect to receive.
HMRC
His Majesty’s Revenue and Customs
The UK’s official tax authority.
NI / NIC
National Insurance / National Insurance Contributions
A tax in all but name, payable to HMRC on certain earnings, including wages. The NI taken off a person’s wages before the wages are paid out is called employee’s NI. Employers must often also pay NI to HMRC over and above the wages they pay out, and this is called employer’s NI.
NLW
Employers must pay at least the NLW per hour to all their workers aged 21 or over. This rule does not apply if the employer is a limited company and the worker is a director of that company.
NMW
Employers must pay at least the NMW per hour to all their workers above school-leaving age. There are different NMW rates for apprentices. An employer that is a limited company is not required to pay NMW to its directors.
PAYE
The system under which income tax and employee’s NI are deducted from workers’ wages and paid to HMRC.
RTI
The system under which reports are sent to HMRC on or before workers’ payday, showing how much they have earned and what is due to be paid to HMRC. See also EPS and FPS.
SAP
The legal minimum pay an eligible employee must receive if they are taking time away from work to adopt a child or to have a child through surrogacy. Employers can reclaim 92% of paid SAP from HMRC (108.5% if the employer qualifies for Small Employers’ Relief).
SMP
The legal minimum pay an eligible employee must receive if they are taking time away from work to give birth to a baby. Employers can reclaim 92% of paid SAP from HMRC (108.5% if the employer qualifies for Small Employers’ Relief).
SNCP
The legal minimum pay an eligible employee must receive if they are taking time away from work because a child born to them or their partner needs special care. Employers can reclaim 92% of paid SNCP from HMRC (108.5% if the employer qualifies for Small Employers’ Relief).
SPBP
Statutory Parental Bereavement Pay
The legal minimum pay an eligible employee must receive if they are taking time away from work because a child of theirs - or their partner’s - dies or is stillborn. Employers can reclaim 92% of paid SNCP from HMRC (108.5% if the employer qualifies for Small Employers’ Relief).
SPP
The legal minimum pay an eligible employee must receive if they are taking time away from work while their partner gives birth to a baby, adopts a child or has a child through surrogacy. Employers can reclaim 92% of paid SNCP from HMRC (108.5% if the employer qualifies for Small Employers’ Relief).
SSP
The legal minimum pay an eligible employee must receive while they are absent from work through illness. Employers can no longer reclaim SSP from HMRC.
ShPP
Additional pay that new parents (including through adoption, surrogacy or fostering) may be entitled to claim to share with their partner, in lieu of some of their maternity or adoption pay. Employers can reclaim 92% of paid ShPP from HMRC (108.5% if the employer qualifies for Small Employers’ Relief).
Easy-to-use, HMRC-recognised payroll
Staying compliant with PAYE can be a tedious task. But with FreeAgent, you can effortlessly run monthly payroll and submit your Real Time Information (RTI) payroll directly to HMRC. Find out more here.
