What is an employer reference number (ERN)?

What is an ERN number?

The ERN number is given to every business that registers with HMRC as an employer. It’s a unique set of letters and numbers used by HMRC and others to identify your firm.

This reference is made up of two parts: a three-digit HMRC office number, and a reference number unique to your business. It’ll usually look something like 123/A45678 or 123/AB45678 (though there can be exceptions).

How do I find my employer reference number?

You'll find it in the welcome pack you received when you first registered as an employer with HMRC. Plus, you'll find it on some of your correspondence from them and you should also find it on payslips, P45s, P60s, or P11Ds issued to past or present employees.

What is a PAYE reference?

It doesn’t help that an employer reference number can be called lots of different names. HMRC calls it an employer PAYE reference number on their ‘Register as an employer’ page.

It’s usually shortened to ERN and is also known simply as an employer PAYE reference or tax office reference number, but don’t be put off by all the different names – they refer to the same number.

How to register as an employer

As mentioned, you get your PAYE reference number when you register as an employer with HMRC.

You usually have to register when you start employing staff, or subcontractors for construction work, for example. You also have to register if you run a limited company by yourself, because as a director you’re an employee.

Here’s what you need to do:

• register before the first payday – register as soon as you can, because it can take up to five working days to get your PAYE reference number (although you can’t register more than two months before you start paying people)
• register as an employer – there are two separate sections on the government website, one for limited companies with one to nine directors and a section for other types of businesses
• send a late full payment submission to HMRC – only if you need to pay an employee before getting a PAYE reference number (you should run payroll and store your full payment submission to send to HMRC later – this is the report that lets HMRC know about payments to employees, and deductions)

When do I need an ERN?

HMRC needs your ERN in a number of different circumstances, including when you complete your end-of-year PAYE return. An invalid or missing ERN is one of the most common reasons end-of-year returns are rejected – you need this number to meet your statutory reporting obligations.

It’s also likely that you’ll be asked for your ERN by an employee at some point. Employees often need their employer’s PAYE reference number when applying for tax credits (or Universal Credit), applying for student loans, and a few other applications. You may also be required to include it on payslips.

Finally, you need to have your ERN to hand when you buy employers’ liability insurance. This is so you can identify the firms an employee has worked at if there's a claim a long time after the event – for example, in the case of mesothelioma claims relating to exposure to asbestos.

What if I’ve lost my ERN number?

It’s important to keep hold of your employer PAYE reference number, as you’ll need it regularly throughout the tax year. If you lose it, you’ll be able to find it in letters or emails about PAYE from HMRC.

It’ll also appear on any P45s or P60s for previous or current employees.

If you don’t have any record of your ERN, it may be that you’re not registered as an employer. If this is the case, but you’re employing or intend to employ someone, you should register as soon as possible. Read our employment status guide to work out what applies to you.

Why do I need to give my ERN to my insurer?

The Employers' Liability Tracing Office (ELTO) has set up a database to help employees identify their past employers' insurers, making it easier for them to make an employers’ liability claim. You’ll therefore need your ERN when you buy employers' liability insurance.

The HMRC ERN helps you identify which firms an employee has worked for in case they make a claim against you. Say they develop mesothelioma after exposure to asbestos and claim you’re responsible. Using ERNs, it’s easy to see where else that employee has worked (and, for the sake of this example, find out they were only exposed to asbestos in their previous job).

Exceptions to PAYE

You won’t have an employer PAYE reference number if you don’t have to register under PAYE. You don’t have you register for PAYE if:

• your employees are paid as self-employed or paid via an agency
• no employee earns more than the lower earnings limit (£123 a week in 2023-24)
• your employees are unpaid volunteers
• your business is based in the Channel Islands or the Isle of Man

What about your tax office reference number?

You'll also have a unique tax payer reference (UTR) for your business (sole traders also have an individual UTR). This is sometimes called HMRC's tax office reference number.

Useful guides for small businesses

• What is gardening leave? A guide for employers
• How to create an occupational health policy
• Self Assessment tax returns: a guide for the self-employed
• What does employers' liability insurance cover?

If you have a Simply Business policy with us, please submit your employer PAYE reference number (ERN) if you haven’t already.