#Uk employee payroll number manual#However, if one looks at the HMRC guidance in its PAYE Manual at PAYE81610, which gives its view of the case law, this says: As with any assessments linked to case law rulings, the precise facts and circumstances of each situation can alter depending on whether an employer has a ‘taxable presence’ here. #Uk employee payroll number registration#HMRC accepts that, based on Clark v Oceanic Contractors STC 35, PAYE registration is required only if there is a taxable presence in the UK. a building project which is designed to last for fewer than 12 months (or six months according to some double tax agreements).Īs such, if these are not permanent establishments, what is the position on registering for payroll withholding in the UK? Is there any obligation for these businesses to register? As with many things in tax, the answer can be: ‘It depends.’.a branch operation – say for marketing and market research support to the overseas entity and. a warehouse in the UK for a foreign business used for storage or display purposes.a buying office in the UK for an overseas business.For example, there may be a UK sales office but it undertakes only ‘preparatory activities’ and these, for example, may be undertaken from the homes of individual employees rather than in any fixed office or similar.įurther, double tax agreements would suggest that the following are, in effect, not permanent establishments for corporate tax purposes: However, in some cases, the position in this regard can be less clear-cut. If there is a UK permanent establishment, there is a clear obligation for the entity to register in the UK and to account for PAYE income tax and National Insurance for the UK-based employees. For example, if there is a UK production facility or a sales office leading on negotiations and the like with clients, there should be no doubt that there is a permanent establishment in the UK. If there is not a subsidiary it will be necessary to consider whether there is a permanent establishment in the UK. If there is a UK subsidiary entity employing individuals this will always create a UK payroll obligation. The obligations for employers can depend upon a number of factors and the answers to questions including:Ī) Is there a UK subsidiary? Has a permanent establishment (or similar taxable presence) been created in the UK?ī) Is the overseas employer based in the EU? Here, the EU includes Switzerland and the European Economic Area (EEA) countries of Norway, Iceland, Liechtenstein.Ĭ) Would the UK employees be caught by ‘the agency regulations’ for off-shore employees?ĭ) Are there ‘political’ or wider business and human resources factors?Į) Does the person work for a foreign embassy in the UK? UK subsidiaries and permanent establishments So what obligations – if any – arise for such foreign enterprises from a UK perspective with regard to the deduction of income tax and National Insurance contributions under the PAYE system? Do such enterprises need to register for PAYE and National Insurance? And if so, under what circumstances? Further, are there any obligations for employees? What are these and when would they apply? The position for employers Many people work in the UK on an ongoing basis, but are employed by foreign enterprises – foreign companies without any formal presence in the UK or foreign embassies, for example.
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