Employment Tax

Overview of international aspects

Produced by Tolley
  • 19 Oct 2021 23:28

The following Employment Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Overview of international aspects
  • Taxation
  • National Insurance
  • Pensions
  • National Minimum Wage

Overview of international aspects

The UK rules on tax, National Insurance, pensions and employment law have all been developed primarily for application to employees who are domiciled and permanently resident in the UK, and employed by UK employers.

However, in today’s worldwide economy it is not unusual to have individuals moving across borders to take up work in another country, either as a new employment or as a temporary secondment. International business trips are by no means uncommon. Multinational companies may move staff from a post in one country to a new job in another. In short, the world of employment is becoming increasingly more internationally mobile.

The international topic in this module focuses on the particular rules that apply to internationally mobile employees.


The key factors determining the tax treatment of an individual’s income from employment are:

  1. whether the employee is resident in the UK (see the Statutory residence test guidance note)

  2. whether the employee is domiciled in the UK or deemed domiciled in the UK (see the Domicile overview guidance note)

  3. the location where the duties of the employment are carried out (see the Foreign employment guidance note)

  4. the residence of the employer (see the Location of employer and effect on liability guidance note)

  5. the application of any double taxation agreement (see the Double taxation agreements and employment taxes guidance note)

An employee is subject to income tax in the UK if he is resident in the UK or he is carrying out employment duties in the UK. More specifically:

  1. if an employee is UK resident and UK domiciled, he is liable to UK tax on his worldwide earnings

    If an employee is UK resident, does not meet the three-year non-residence requirement and is non-domiciled with the remittance basis applying, any earnings in respect of duties performed wholly overseas for a foreign employer are taxable only if they are remitted (brought) to the UK (see the Remittance basis ― overview guidance note).

  2. where an employee is UK resident,

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