Care payroll is not standard payroll. The sector has three compliance risks that a generic bureau routinely misses: sleep-in shifts and the National Minimum Wage test set by the Supreme Court in <em>Mencap v Tomlinson-Blake</em>, inter-call travel time that must be paid as working time, and holiday pay reference periods that must include average travel and overtime payments. Add the <a href="https://www.gov.uk/national-minimum-wage-rates">National Living Wage of £12.71 for workers aged 21 and over from 1 April 2026</a>, employer NIC at <a href="https://www.gov.uk/guidance/rates-and-thresholds-for-employers-2025-to-2026">15% above the £5,000 secondary threshold</a> and the true cost-per-head of sponsored overseas staff, and the wage bill is the single area where a processing error becomes an HMRC compliance event. We run payroll that handles all of it, and we model the cost base so your fee rates and budgets reflect reality.
<a href="https://www.gov.uk/guidance/calculating-the-minimum-wage/working-hours-for-which-the-minimum-wage-must-be-paid">Travel between client visits is working time for NMW purposes</a>. Rota systems that pay only for contact time and nothing for inter-call journeys create unlawful pay shortfalls. This is the single most common source of NMW underpayment in domiciliary care and a specific HMRC audit focus.
Holiday pay for irregular-hours care staff must be calculated on <a href="https://www.gov.uk/holiday-entitlement-rights">average hours worked in the reference period</a>, including travel payments and average overtime. Omitting those elements from the reference period understates entitlement and creates Employment Tribunal exposure.
Workers on rotas who cannot send substitutes, who are told when and where to work and who are subject to the provider's direction are <a href="https://www.gov.uk/employment-status/employee">employees for PAYE purposes</a> regardless of the label on their contract. HMRC care-sector audits focus precisely on this pattern. Back-dated PAYE, NIC and NMW liability can reach years into the past.
Sponsoring overseas care staff through the <a href="https://www.gov.uk/health-care-worker-visa/eligibility">Health and Care Worker visa</a> requires an approved <a href="https://www.gov.uk/uk-visa-sponsorship-employers">sponsor licence</a> with ongoing HR record-keeping duties, and each sponsored worker triggers the immigration skills charge. Providers who do not model this cost per head into their fee rates routinely find the true wage bill is higher than budgeted.
We apply the <a href="https://www.gov.uk/guidance/calculating-the-minimum-wage/working-hours-for-which-the-minimum-wage-must-be-paid">awake-for-work test</a> to sleep-in shifts, include inter-call travel as working time and calculate holiday pay on the correct reference period including average travel and overtime payments. The result is a payroll run that reflects what the law requires, not what is easiest to process.
We model <a href="https://www.gov.uk/guidance/rates-and-thresholds-for-employers-2025-to-2026">employer NIC at 15%</a> above the £5,000 secondary threshold per worker, apply the <a href="https://www.gov.uk/claim-employment-allowance">£10,500 Employment Allowance</a> where you are eligible and produce a per-head cost figure you can use in fee-rate calculations. A blanket payroll percentage understates the cost for part-time-heavy rotas.
We factor the sponsor licence obligations and per-head immigration skills charge into your cost model and review worker classification across your rota before HMRC does. Finding a misclassification risk on your terms, with time to correct it, is materially cheaper than finding it during an audit.
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