Employment through offshore intermediaries

Changes to the offshore intermediaries rules will clearly identify who is responsible for PAYE, NIC and Real-time Information (RTI) reports. Additional reports will be required to cover cases not included in RTI.

Identifying the ‘employer’ for PAYE, NIC and RTI 

Changes announced by the Government on 14 October 2013 will be put into effect from 6 April 2014. The purpose is to identify which entity is responsible for PAYE and NIC where an employee is employed by a non-UK employer to provide work to a person in the UK (the “relevant person”).

If there is no UK intermediary the relevant person (i.e.the UK end user) will still be liable for PAYE and NICs.

If there is a single UK intermediary between the relevant person and the offshore employer, that intermediary will be liable for PAYE, NICs.

If there is a chain of UK intermediaries it is the one immediately closest to the offshore employer that will be liable for PAYE and NIC.

The 2014 Finance Bill will contain additional RTI and reporting obligations for intermediaries which are also due to come into effecton 6 April 2014.

The above provisions do not apply to oil and gas workers on the UK continental shelf for whom separate rules are proposed and further consultation is in progress.

Onshore intermediaries

Separate rules apply to UK onshore intermediaries; click here to see Mazars’ comments on those proposals