As a skilled workforce will be critical to your success, there are a number of considerations when employing in the UK, including:
- National Minimum Wage – The amount you pay your staff must be at least the national minimum wage, although there is a climate for an alternative living wage, dependent on where you set up
- It is your responsibility to ensure that your employees have the legal right to work in the UK
- Employers’ liability insurance is critical from day one of employment
- Registration with HM Revenue & Customs (HMRC) as an employer operating PAYE/NIC on all payments made from day one is mandatory
Even if you are using your own staff from overseas and bringing them into the UK, you have to consider:
- Short term visitors to the UK – When non-UK employees visit the UK for short periods, from a few days to 6 months, their salary, even if paid outside the UK, falls within the UK employment tax system unless the rules and reporting obligations around Short Term Business Visitors are followed
- National Insurance (NI) exemptions for secondees – Where individuals come to work in the UK temporarily, it is normally possible to agree a period of exemption from NI, ranging from one to five years depending on the employee’s home country
- Detached Duty Reliefs and dispensations
- Overseas Workdays relief
We can assist and guide you on all of the above. Please contact a member of team to find out how we can help.
An employer is usually required to operate PAYE as part of their payroll. This is HMRC’s system to collect income tax and National Insurance, meaning that it is deducted from the employee’s gross pay before reaching the employee themselves.
Moore Kingston Smith can operate your PAYE through its payroll system. Alternatively, you would need to choose your payroll system to record details, calculate pay and deductions and report to HMRC.
National Insurance Contributions (NIC)
NIC is essentially a tax on earnings.
Employers currently pay NIC at the rate of 13.8% of employees’ gross salary above £8,112 per year, whilst employees pay additional NIC at a rate of 12% of salaries between £8,060 and £43,000 and 2% on all earnings above that. Meanwhile, self-employed individuals are liable to lower rate NICs.
The Government has introduced an allowance of £2,000 per year that some businesses can offset against their employer’s NIC liability.
Many companies setting up in the UK find it useful to engage with our payroll services so that they can focus on the development of their company. Our team can help by:
- Producing payslips on a monthly basis and making arrangements for payment
- Notifying you each month of the tax and NI contributions payable to HMRC and organising payment to keep you compliant
- Dealing with the end of year payroll compliance on your behalf
Pensions is a complex area in the UK and, with all employees having to comply with auto-enrolment regulations, there are various considerations you need to give to the pension packages you offer.
We can help you through this maze. For more information, click here or contact a member of the Moore Kingston Smith Financial Advisers team.
Businesses setting up are unlikely to have the resources of an in-house HR team. Comprising tax specialists, HR consultants and independent financial advisers, KSHR Consultancy are a one-stop-shop for all your employer-related needs that can help out with any of your queries.
The attraction and retention of talented staff and the establishment of a strong internal structure are key to the long-term success of your company. With a considerable range of benefits that employers can offer their staff, we can help you put together a benefits package that is both tax effective and attractive to your employees.
For more information on the choice of benefits, please click here.