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Employing Staff Overseas

Our client is a UK-based company within the software industry, who often employ the services of overseas subcontractors for assisting with their niche research and development (R&D) projects. Following a meeting with our client, it became apparent that they wanted to bring two of their overseas subcontractors onto their UK payroll, but were unsure of the UK tax implications for both themselves and the individuals concerned. Our client did not want their prospective employees to be taxed both in the UK and overseas in their local territories.

How we helped our client
We advised our client that bringing subcontractors onto their payroll may result in an obligation to deduct PAYE and NIC from the employees’ gross salaries, but that this would depend on where the employees perform their duties. After a discussion with our client, we were able structure the working arrangement in such a way that there would be no UK PAYE implications, and thus no double taxation issues for the individuals.

Through our links with Kreston, we were also able to provide our client with details of the local taxes that may be due by the individuals.

For more information or to discuss further, please contact the Employer Solutions Taxperts.

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