Several months into the new PAYE rules, some of the same mistakes keep showing up in payroll processes. Most are avoidable with a direct check against the current bands.
These mistakes sit on both sides of payroll: how the tax is calculated, and how it is remitted and reported afterwards.
Calculating the wrong way
The most persistent mistake is a payroll template still built for the old system. Abolished from 1 January 2026, so any process still subtracting one is working from an outdated assumption.
A close second is applying a band's rate to an entire salary, rather than only the slice of income sitting inside that band. The 2026 PAYE bands explained sets out why that overstates the tax owed.
Mishandling reliefs
Rent relief needs documented rent behind it; applying it without that documentation, or failing to apply it when the documentation exists, are both mistakes in opposite directions. See rent relief: how to claim it for what is involved.
Missing the monthly remittance
The 10th day of the following month. Treating this as an occasional task rather than a fixed monthly one is a common way employers fall behind without noticing immediately.
Missing the annual return
Separately, 31 January is the deadline for the employer's annual PAYE return. Employers who remit correctly every month sometimes still miss this yearly summary, treating the monthly habit as the whole obligation.
Treating reliefs as automatic
Neither rent relief nor any other targeted relief applies itself. Assuming one has been picked up automatically, without checking, leaves an employee either overpaying or underpaying tax without anyone noticing until much later.
Remitting to the wrong place
PAYE goes to the state where the employee lives, not automatically to the employer's own registered address. A business with staff in more than one state needs to split remittances accordingly, not send everything to one state by default.
Why these particular mistakes persist
Most of these errors are not the result of carelessness. They are the ordinary friction of updating a system that used to work one way to a system that now works differently, spread across payroll teams of very different sizes and levels of automation.
That is exactly why a direct check against the current rules, rather than trust in whatever the software already produces, catches more than waiting for an employee to complain.
Fixing these mistakes
Most of these are caught by a direct comparison: run a real salary through the PAYE calculator and compare the result against what payroll currently produces. A mismatch points to exactly where to look first.
For the rest of this series, including old versus new PAYE for the fuller change, see the PAYE and state tax hub. A short review now is cheaper than untangling months of small errors later.