Your employer reference number (ERN) is a unique set of numbers and letters, made up of two parts:
When registered with HMRC, you’ll receive this reference in your welcome pack. On tax forms, it’s often referred to as an employer Pay As You Earn (PAYE) reference number and you need it for end of year HMRC PAYE returns.
You’ll mainly use your ERN as a tax reference number, for tax returns at the end of the year. Without this, your PAYE return would be rejected. The reference could also be used for:
Your ERN will be used in the event of an insurance claim, as the employers’ liability Tracing Office (ELTO) will use it to track down your insure and start the claim process. It’s an important piece of information to share with your insurance broker when arranging your policy.
Without a registered ERN, your employers’ liability insurance could be cancelled.
Your ERN number is split into two parts, a three-digit tax reference number and a set of digits that identify your business to HMRC. It will look like this: 123/AB12345.
Some small businesses aren’t required to have an employer reference number. For example:
If you’re unsure about whether you need an ERN or not, contact HMRC
If your business operates with separate PAYE schemes for multiple locations, HMRC may have issued you multiple employee reference numbers.
An employer’s PAYE is a way for HMRC to collect Income Tax and National Insurance Contributions (NICs). Employers are exempt from having to register for the PAYE scheme if: