Short term business visitor and annual payroll reporting
The reporting deadline for submission of the year-end filing of annual Short Term Business Visitor (STBV) reports and Annual PAYE reporting is approaching in the UK.
To recap, where STBVs to the UK are exempt under the terms of the Double Taxation Agreement between the UK and their home country, PAYE is still strictly due unless the company has a STBV Agreement in place. Further, where any STBVs are taxable in the UK, PAYE tax withholding will be due each month unless the company has put in place an Annual PAYE scheme (for STBVS in the UK for 30 days or less each tax year – 60 days or less from 6 April 2020) which allows PAYE to be operated at year-end in month 12. STBVs is a key area of review for HMRC as they know many companies are not fully compliant with the rules and are not properly tracking all their visitors to the UK. This is an area HMRC will often explore in depth in any audit. Therefore, it is imperative for companies to ensure compliance with the STBV regulations especially given the requirements under Senior Accounting Office and Corporate Criminal Offences legislation, and the wider tax impact STBVs can create including Transfer Pricing and Permanent Establishment considerations.
Business Visitors is a topic that has been historically viewed as difficult to tackle due to the volume of trips, issues with the collation of data and internal resource available. Covid-19 has caused an inevitable slowdown in business traveller movement and consequently there may never be a better opportunity for companies to put in robust measures to ensure ongoing compliance.
HMRC have confirmed the amendment of the deadline for 2021 to June 30 in relation to the submission of STBV reports and in relation to the operation of annual payrolls.