One template, two countries
The jurisdiction dropdown on the first task shows the US phases or the UK phases and hides the rest. A US hire never sees a P45 task, and a UK starter never gets a W-4 reminder.
New Hire Payroll Setup Checklist
Set-up mistakes show up on the first payslip: an emergency tax code nobody replaced, a W-4 that never came back, a pension letter that was never sent. Set each new starter up properly once, and the regular pay run has nothing to fix.
This free new hire payroll setup checklist takes one new starter from the accepted offer to a checked first payslip. One dropdown chooses the country. In the United States it covers Form W-4, the state withholding certificate, the state new hire report, FLSA classification, direct deposit and benefits deductions. In the United Kingdom it covers the P45 or starter checklist, the tax code, National Insurance, student loans, the Full Payment Submission and pension auto-enrolment. A payroll lead approves the set-up before the first pay run.
Set Up Once, Then Hand Over to the Pay Run
This is the one-off set-up for a single new starter. Running payroll every week or month is a separate, recurring job, and the Payroll Processing SOP Checklist covers it. The two connect at the first payday. Any error made here, such as a wrong tax code, a missing withholding form or a pension decision nobody recorded, carries into every later pay run until someone notices it.
Work eligibility is checked separately. US employers complete Form I-9 for every hire, and UK employers check the right to work before employment starts. Each check has its own deadlines and records, so run it with the Form I-9 & E-Verify Compliance Checklist or the Right to Work Check Checklist (UK). This template only asks you to confirm that the check is on track.
One template covers both countries. The first task asks where the employee will work. Pick the United States for withholding certificates, state reporting and wage-and-hour classification. Pick the United Kingdom for the tax code, National Insurance, student loans and pension auto-enrolment.
Federal and state
United States
Withholding: the employee completes the 2026 Form W-4, and most states with an income tax have their own certificate. If no W-4 comes back, withhold as if the employee had ticked single or married filing separately and made no other entries.
Reporting: federal law requires a new hire report to the state within 20 days of hire. Some states set a shorter deadline.
Classification: the Fair Labor Standards Act decides who is owed overtime. An exempt employee must pass a salary test, currently at least $684 a week, and a duties test.
HMRC and TPR
United Kingdom
Tax code: taken from the P45, or worked out from the HMRC starter checklist when there isn’t one. The emergency code for 2026/27 is 1257L on a week 1 or month 1 basis.
Reporting: HMRC learns about a new starter from the first Full Payment Submission, sent on or before their first payday.
Pension: a worker aged 22 to state pension age who earns over £10,000 a year must be enrolled into a workplace pension, and told about it in writing, within six weeks.
State law varies widely in the US, on income tax, new hire reporting, pay frequency, direct deposit and local taxes, so check the rules in each state where your people work. This template turns IRS, HHS, Department of Labor, HMRC and Pensions Regulator guidance into process steps; it is not legal or tax advice. For an unusual case, such as a company director, someone working from abroad or a disputed employment status, talk to a payroll adviser or an employment lawyer before the first pay run.
What the New Hire Payroll Setup Checklist Covers
Six phases for each new starter. The first and last phases apply in both countries. The jurisdiction dropdown then shows either the two US phases or the two UK phases, never both.
Phase 1
Phase 1: Set Up the New Starter
- Log the new starter, start date and first payday — and choose the country, which sets the tasks that follow
- Confirm the person is an employee, not a contractor — their status decides whether payroll applies at all
- Record the agreed pay, hours and pay frequency — from the signed offer, not from memory
- Check the Form I-9 or right to work check is on track — it runs as its own checklist
Phase 2 — If US
Phase 2: US Tax Forms & State Reporting
Shown when the jurisdiction is United States.
- Collect the 2026 Form W-4 — effective from the first wage payment
- Collect the state withholding certificate — for example California’s DE 4 or New York’s IT-2104
- Record the name and Social Security number exactly as shown on the card
- Report the new hire to the state — within 20 days, or sooner where the state requires
- Set up state unemployment and local taxes — for the state and locality where the work is done
Phase 3 — If US
Phase 3: US Pay Status & Deductions
Shown when the jurisdiction is United States. The classification is an approval for the person picked on the first task.
- Classify the job as exempt or non-exempt under the FLSA — salary level, salary basis and duties, never the job title
- Check the pay rate against federal, state and local minimum wage
- Get the direct deposit authorisation — or set up the payment method the employee chooses
- Set up benefits and retirement deductions from the employee’s elections — pre-tax or after-tax, from the right pay date
Phase 4 — If UK
Phase 4: UK Tax Code, NI & Student Loans
Shown when the jurisdiction is United Kingdom.
- Collect the P45 or the HMRC starter checklist — the starter checklist replaced the P46
- Set the tax code — from the P45, or from statement A, B or C on the starter checklist
- Record the National Insurance number and category letter — most employees are category A
- Set up any student or postgraduate loan deductions — one of Plan 1, 2, 4 or 5, plus a postgraduate loan if both apply
- Check the pay rate against the National Minimum Wage — £12.71 an hour at 21 and over from April 2026
Phase 5 — If UK
Phase 5: UK Pension Auto-Enrolment
Shown when the jurisdiction is United Kingdom. Duties apply from the starter’s first day of employment.
- Decide whether to use postponement — up to three months, with a written notice within six weeks
- Assess the starter’s age and earnings — on the first day of employment, or at the end of postponement
- Enrol an eligible jobholder within six weeks — membership backdated to the automatic enrolment date
- Write to the starter about automatic enrolment — within six weeks, whether or not they are enrolled
- Handle any opt-out request within one month — stop the deductions and refund what was paid in
Phase 6
Phase 6: First Payroll & Hand-Over
The Full Payment Submission task appears only when the jurisdiction is United Kingdom.
- Check the first payslip before it is paid — gross pay, tax, deductions and net pay
- Payroll lead approves the new starter set-up — before the first pay run is committed
- Send the Full Payment Submission on or before the first payday (UK)
- File the payroll forms and set their retention dates
- Hand the employee over to the regular pay run
New Starter Payroll Deadlines at a Glance
Most set-up deadlines run from one of two dates: the first day of work or the first payday. Put both on the first task and the template dates everything else from them. The table shows the legal deadline; set your own target earlier, so a late form never holds up a payslip.
| Step | Country | Deadline | Authority |
|---|---|---|---|
| Form W-4 | US | Ask for it when work starts; it applies from the first wage payment | IRS |
| New hire report | US | Within 20 days of hire under federal law; 7 days in Alabama and Maine, 14 in Massachusetts | State Directory of New Hires |
| W-4 records | US | Keep with employment tax records for at least four years | IRS |
| P45 or starter checklist | UK | Before the first Full Payment Submission | HMRC |
| Full Payment Submission | UK | On or before the first payday | HMRC |
| Starter checklist records | UK | Keep for the current and the next three tax years | HMRC |
| Pension enrolment and letter | UK | Within six weeks of meeting the age and earnings criteria | The Pensions Regulator |
| Opt-out refund | UK | Within one month of a valid opt-out request | The Pensions Regulator |
A rehire counts as a new hire for state reporting when the person has been away for at least 60 consecutive days, so report returning employees too.
Choosing a UK tax code without a P45
The employee ticks one statement on the HMRC starter checklist (form version 12/25) and payroll applies the matching code. With a P45 instead, use the code shown in parts 2 and 3. Once the first submission has gone, keep using that code until HMRC sends a new one.
| Statement | What the employee is telling you | Code for 2026/27 |
|---|---|---|
| A | This is their first job since 6 April, with no Jobseeker’s Allowance, Employment and Support Allowance or Incapacity Benefit | 1257L |
| B | They have had another job since 6 April but have no P45, or have received one of those benefits | 1257L W1/M1 |
| C | They have another job, or receive a state, workplace or private pension | BR |
The same form asks about student loans. For 2026/27, deductions are 9% of earnings above £26,900 for Plan 1, £29,385 for Plan 2, £33,795 for Plan 4 and £25,000 for Plan 5, and 6% above £21,000 for a postgraduate loan. Only one plan is deducted at a time, alongside a postgraduate loan if the employee has one. Payroll software does the arithmetic. Your job is to enter the right plan.
Why Run New Hire Payroll Setup in CheckFlow?
Dated from the start and the payday
Enter the start date and the first payday once. The W-4, the state report, the pension letter and the payslip check are each dated from them and assigned to the right person, so a late form shows as overdue before the pay run.
A sign-off before the money moves
The payroll lead approves the set-up as an approval task, and the checklist halts until they do. Forms are uploaded to the task, and the audit trail shows who completed each step and when.
Payroll set-up is one stage of hiring. CheckFlow’s HR checklist software runs recruitment, compliance checks, onboarding and departures from templates, with assignments, due dates and approvals shared between HR, payroll and hiring managers.
Payroll is only one part of a new starter’s first weeks. CheckFlow’s onboarding software runs this checklist alongside the Employee Onboarding Checklist, so equipment, training and pay are all ready for day one.
Frequently Asked Questions
How is this different from a payroll processing checklist?
This checklist runs once for each new starter and ends when their first payslip has been checked. A payroll processing checklist runs every pay period for everyone: collecting hours and changes, calculating pay, approving the run, paying and filing. Use this one to put a new person into payroll correctly, then the Payroll Processing SOP Checklist to pay them from then on.
What if a new US employee does not return a Form W-4?
Pay them anyway, and withhold federal income tax as if they had ticked single or married filing separately in Step 1(c) and made no entries in Steps 2, 3 or 4 of the 2026 form. When a completed W-4 arrives, apply it from then on; don’t adjust earlier pay periods. A W-4 claiming exemption from withholding only lasts for the calendar year, so the employee must give you a new one by 15 February to stay exempt.
When must a new hire be reported to the state?
Federal law sets a maximum of 20 days from the date of hire, reported to the state where the employee works. Some states set less: Alabama and Maine require 7 days, and Massachusetts 14. The report carries seven federal data items, including the employee’s name, address and Social Security number, the date of hire and the employer’s Federal Employer Identification Number, and states may ask for more. Employers in more than one state can register with HHS to report every new hire to a single state.
Which tax code should we use for a UK starter without a P45?
Ask them to complete HMRC’s starter checklist and use the statement they choose. For 2026/27, statement A means 1257L, statement B means 1257L on a week 1 or month 1 basis, and statement C means BR. If they have a P45, use the code shown on it instead. Whatever goes on the first Full Payment Submission stays in use until HMRC sends a new code, even if a P45 turns up later.
Does every UK new starter have to join a workplace pension?
No, but every starter must be assessed and written to. Those aged 22 to state pension age earning over £10,000 a year (£833 a month) must be enrolled within six weeks, with at least 8% of qualifying earnings paid in, of which at least 3% comes from the employer. Others can ask to join, and the employer must contribute if they earn over £6,240 a year. You may postpone the assessment for up to three months if you write to the worker within six weeks. Anyone enrolled can opt out within a month and receive a full refund.
Can we insist that new employees are paid by direct deposit?
Not by naming the bank. Federal Regulation E bars anyone from requiring an employee to open an account at a particular institution as a condition of employment. Whether you can require direct deposit at all, and what written consent you need, depends on state law, so offer another method where the state requires one. In practice, collect a signed authorisation with the account details and confirm them with the employee before the first payday.
Is CheckFlow free for this template?
14-day free trial, no card required. The Business plan is $10 per user per month after the trial. Full details at checkflow.io/pricing.