United Kingdom - Short-term business visitors agreements deadline approaching

Strict pay-as-you-earn (PAYE) obligations exist for UK employers that require PAYE withholding when an employee from an overseas parent, subsidiary or associated company visits the UK to work, either for a planned project or on an ad-hoc basis. For visitors who originate from countries with which the UK has entered into a double taxation agreement, HMRC introduced the Short-Term Business Visitor Agreement, which requires annual reporting of business visitors in exchange for a relaxation of the PAYE obligation. 

To be eligible to access the scheme, employers must apply for an agreement with HMRC prior to the end of the tax year in which they agree to track their visitors and prepare annual reports of their visitors for submission.

Annual PAYE scheme (appendix 8)

Whilst considering business visitors to the UK, it is worth highlighting that the Short-Term Business Visitor Agreement only relaxes the PAYE requirements for individuals that meet the criteria of the relevant double taxation treaty. It therefore does not cover non-resident employees employed by a foreign branch of a UK company, individuals coming from non-tax treaty countries or where the treaty conditions are not met (for example, due to a costs recharge). In those circumstances, the only option for an employer is to operate PAYE. 

The Annual PAYE scheme was introduced to combat the impracticality for employers of having to deal with employees that do not qualify for STBV treatment by allowing them to account for their visits to the UK for the entire tax year and operate PAYE at the tax year-end, with tax due and the associated Real-Time Information (RTI) reporting to happen at month 12. This applies only to limited categories of visitors. 

How we can help

The deadline for reporting for both the STBV report and the annual PAYE scheme for the tax year ended 5 April 2023 is May 31. If you need assistance with either scheme, our BDO professionals can help.

Our wider business traveller service brings together the experience of Global Employer Services specialists in over 160 countries to advise on employer- and employee-related obligations that arise due to short-term cross-border movement or remote working, and assist with the completion of relevant compliance requirements as they arise. 

Backed by our BDO QuickTrip technology platform, we can provide a holistic solution to the ongoing tracking requirements of your cross-border employee population and the compliance risks that may result from their travel. 

Stuart Strong
BDO in United Kingdom