Straight Talking Advice:
Please note that the organisation will still require a PAYE scheme if it wishes to take advantage of an STBV arrangement
By default any individual undertaking employment duties in the UK is immediately liable to UK employment taxes, even if they are only in the UK for a matter of days.
Where certain pre-agreed conditions are met, a UK employer can apply to HMRC not to operate PAYE on the earnings of short term business visitors. This is known as a Short –Term Business Visitors’ Agreement (STBVA), or an Appendix 4 agreement.
It is important to bear in mind that if the individual overstays the thresholds, they will become subject to UK taxes on the income from the day they arrived
An employer wanting to take advantage of a STBVA must have an internal reporting system to track days spent by business visitors working for them in the UK. As a minimum, the employee must periodically report days spent in the UK to their employers so this information can be logged. Employees must not spend more than 30 days intermittently in the UK, without making such a report.
is provided as a general guide below: Visiting UK for 1 to 30 days - no reporting requirements for employer or employee.
We advise that all companies sending employees to the UK periodically should put in place written agreements with the employees to capture the required information. We can provide such agreements on request.
There are restrictions and further detailed conditions, for example the method of counting days spent in the UK, so it is important to seek advice on a case by case basis to ensure this relief is used correctly.
Stautory directors
The income earned by statutory directors can often be covered by its own specific article which is different to the employment income article in the same tax treaty. Details differ by country but very often this means that income earned from such directorships cannot be included in the company's STBV.
A further simplification operates for employees who spend 60 or less workdays in the UK.. Appendix 8 permits employers of such STBVs taxable in the UK, including those from overseas branches and visitors from non-DTA countries to pay and report tax in respect of PAYE income annually.
A single return which includes all pay as well as the cash equivalent of any benefits provided will need to be submitted by 31 May following the end of the relevant tax year.
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