Paying seasonal and temporary staff in the United Kingdom
Reviewed by Mellow Editorial Team, HR & payroll content team
Seasonal and temporary workers are subject to the same PAYE, National Insurance and statutory entitlement rules as permanent employees — the main differences are practical ones around short assignments, variable hours and getting new starters onto payroll quickly.
Getting a new starter onto payroll
Before you can pay someone, you need their starter information. Ask each new worker to complete a starter checklist (the replacement for the old P46) and provide their National Insurance number. The checklist tells you which tax code to use from day one. If a worker has a P45 from a previous employer in the same tax year, use the code shown there instead.
Add the worker to your payroll software as a new employee. Set the correct pay frequency — weekly is common for seasonal roles — and enter the tax code. If no starter information arrives in time, HMRC's guidance directs you to use code 0T on a non-cumulative basis, which taxes all earnings without applying the personal allowance of £12,570.
PAYE and National Insurance
Pay As You Earn applies to everyone you pay through your payroll. You deduct income tax at 20% on earnings above the personal allowance threshold, 40% on earnings in the higher-rate band, and 45% above that. For most seasonal workers earning modest amounts, only the basic 20% rate applies — but the cumulative versus week-one/month-one basis of the tax code determines how the allowance is spread across the year.
National Insurance follows the same rules regardless of contract length. Employees pay 8% on earnings between the primary threshold and the upper earnings limit, then 2% above that. You pay employer NI at 13.8% on earnings above the secondary threshold. Both thresholds are set for the 2026/27 tax year; apply whichever figures HMRC publishes for the current year in your payroll software.
There is no NI exemption simply because a contract is short. A worker on a two-week harvest contract who earns above the weekly primary threshold will trigger both employee and employer NI in those weeks.
Reporting to HMRC in real time
Every time you pay seasonal or temporary staff, you must submit a Full Payment Submission (FPS) to HMRC on or before payday. This is a core requirement under Real Time Information (RTI). There are no concessions for casual or irregular workers — the obligation applies on or before each payment event.
If a worker leaves mid-season, mark them as a leaver in your payroll software on their final pay run. The FPS for that period carries the leaving date to HMRC. You then issue a P45 promptly so the worker can hand it to their next employer. At the end of the tax year, any worker employed on 5 April receives a P60 by 31 May.
Statutory entitlements for short-term workers
Temporary and seasonal workers accrue statutory rights from their first day of work. Annual leave accrues at 5.6 weeks per year (equivalent to 28 days including bank holidays for a five-day week), calculated pro rata for part-year employment. For workers on irregular hours or short assignments, the accrual method is based on hours worked, which means leave builds up as each hour is completed rather than at the start of a leave year.
Statutory Sick Pay applies once a worker meets the earnings threshold and has been sick for more than three qualifying days. Statutory family-leave pay applies where qualifying conditions are met, regardless of contract duration. The Employment Rights Act 2025 has strengthened day-one rights further, so you should not assume temporary status reduces a worker's protections.
Zero-hours contracts and variable pay
Many seasonal roles use zero-hours arrangements. These are lawful, but under the Employment Rights Act 2025 workers on zero-hours contracts gain stronger rights around predictable hours requests after a qualifying period. Keep clear records of hours offered and worked; this matters both for calculating leave accrual and for demonstrating compliance.
Pay must meet National Minimum Wage rates for every hour worked. For zero-hours workers this means tracking actual hours carefully — averaging across weeks is not a substitute for paying correctly in each pay period.
Keeping records and avoiding common mistakes
The most frequent errors with seasonal payroll are: using the wrong tax code because the starter checklist was not collected; missing FPS submissions on payment days that fall outside the normal pay cycle; and failing to issue a P45 when a worker leaves. All three can generate penalties or create problems for workers when they file their own tax returns.
Keep payroll records for at least three years after the end of the tax year they relate to. If you use a payroll bureau or software that handles RTI submissions on your behalf, confirm their cut-off times relative to your actual paydays — the submission must reach HMRC on or before the moment funds leave your account, not on the following working day.
---
Run HR and payroll in United Kingdom with Mellow
Mellow brings HR, payroll and 12 AI agents into one platform — built to handle United Kingdom properly, with payroll included, from £4 per employee per month. The AI agents don't just answer questions; they generate contracts, run cost estimates and draft letters for you.
- United Kingdom payroll software
[Start a free trial →](/register)