The following Employment Tax guidance note Produced by Tolley in association with Sarah Robert of James Cowper Kreston provides comprehensive and up to date tax information covering:
The employer must decide the terms under which the employee should be taken on in the UK. This can range from an assignment through to direct local hire. An assignment usually means that the employee retains some connection with his home country, from a continuing employment relationship with his home employer through to on-going payments into the overseas social security or pension arrangements. The employee may be compensated for the move overseas with relocation costs reimbursed by the employer. He may also receive additional support, with his employer paying for costs in the UK such as accommodation and schooling, and / or he may be given a cost of living allowance.
In the case of an assignment, the employer should consider at the outset how long the assignment is expected to last and the cut-off point, particularly if paying out significant costs relating to the assignment.
The employer needs to consider the employee’s remuneration package. For a local hire arrangement, the employee has to be assimilated to a relevant grade or level in the local organisation. The employee is most likely to receive the same gross pay and benefits package as local employees at that level.
If an assignment is involved, the employer needs to decide whether the employee will be paid gross or be tax-equalised (ie given a net pay equivalent to what he would have received had he remained in his host country).The employer may decide on a hybrid arrangement whereby the employer pays the tax on only some elements of the package such as assignment-related elements, eg schooling or housing.
The employer may also consider tax protection, which generally means the employee pays his own tax in the host country (UK) but this is then compared to his home country tax at the end of the year. If he has paid less, he is allowed to keep the difference but the employer makes good any additional liability.
Short-term and commuter style
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login
IntroductionSubsistence is the amount incurred as a consequence of business travel. Typically it relates to accommodation and meal costs incurred. These amounts are allowed because they are associated with the necessary travel. See the Travel expenses guidance note for more information of when
From 6 April 2015, an individual can elect to transfer 10% of the personal allowance (£1,250 in 2020/21 and 2019/20) to the spouse or civil partner where neither party is a higher rate or additional rate taxpayer. The legislation calls this the ‘transferable tax allowance’ but the GOV.UK website
This guidance note considers the capital gains tax implications where shares are sold in exchange for new shares.The consideration paid by a purchasing company to the shareholder(s) for their shares in a target company could be in the form of either:•new shares in the vendor in exchange for shares
Why is this important?Tax-free amountEach individual, whether or not they are resident in the UK, is entitled to an annual exempt amount when calculating the taxable amount of their chargeable gains for the tax year (although see the exceptions below). The annual exempt amount is also known as the
To view our latest tax guidance content, sign in to Tolley Guidance or register for a free trial.