Posting staff to the UK

Three questions, three sets of rules

When your company sends an employee to the UK, three authorities ask about them. Social security wants to know which system covers them. Tax wants to know where their pay is taxed and who deducts the tax. And the Home Office wants to know whether they may work in the UK at all.

The three answers do not depend on each other. An employee can stay in their home pension system for two years and still be liable to UK income tax from day one. And a certificate of coverage does not replace a visa. Which route fits postings within a group or projects at a UK client is covered under the Secondment Worker route and our visas section; this page is about tax, social security and payroll.

Income tax: the 183-day rule and its catches

Pay is in principle taxed where the work is done. If your employee works in the UK, the UK may tax the pay for that work. The tax treaties make an exception, known to many as the 183-day rule. But it only applies if all three conditions are met: the employee is in the UK for no more than 183 days, the pay is paid by an employer not resident in the UK, and it is not borne by a UK permanent establishment of the employer.

The catch usually lies in the third condition and in the counting. If your company has a UK branch that bears the employee's cost, the exception is gone, even for a three-week assignment. And under many UK treaties the 183 days count over any twelve-month period, not the calendar year, while others use the tax year. Spend four months in the UK in the autumn and four the following spring, and you may be over.

If the employee stays longer or moves with family, they often become UK resident. The statutory residence test decides. For arrivals there is relief on pay for working days outside the UK, overseas workday relief. If, on the other hand, they are not UK resident and work partly in the UK and partly elsewhere, only the pay for UK workdays is taxable in the UK.

The employee's country of residence then exempts the UK-taxed pay or credits the UK tax, depending on its treaty with the UK and its own law. The principles are in the UK's tax treaties.

Social security: the certificate and the 24 months

Since Brexit, social security between the EU and the UK has been coordinated by the protocol in the Trade and Cooperation Agreement. The basic principle has stayed: someone coming from the EU to the UK only ever pays into one system. For posted workers that means they stay in their home system for up to 24 months if their employer normally operates at home and sends them to the UK temporarily. The proof is a certificate from the home institution, which the UK side calls a certificate of coverage or PDA1. With it, no National Insurance is due in the UK, neither for the employee nor for you.

You apply for the certificate to the social security institution at home before the posting starts; each country has its own procedure. If a posting unexpectedly runs longer than 24 months, UK rules generally apply from the 25th month; if it is planned longer from the start, from day one. Countries outside the EU have their own arrangements with the UK, or none; check yours before the posting.

Without a certificate it gets expensive. Then your employee is liable to UK contributions, and as an employer from the EU you owe the 15 percent UK employer contribution even without a UK site. The Brexit overview for businesses is in our Brexit section.

Who deducts UK income tax

If you have a branch or office in the UK, you must operate PAYE for the posted employee. If they work for a UK subsidiary or a client while staying employed by you, and you have no UK presence yourself, the UK company must operate PAYE on the payments you make to them, unless you take that on voluntarily. National Insurance is similar: if an employer without a UK site supplies an employee to a UK company, the UK company counts as the employer, unless an agreement obliges the foreign employer itself.

For short assignments HMRC offers easements. Under the arrangement for short-term business visitors from treaty countries (Appendix 4), PAYE can be relaxed if the employee is expected to spend no more than 183 days in twelve months in the UK. If someone works partly in the UK and partly abroad, since 6 April 2025 you can file a GME PAYE notification that you apply PAYE only to the UK share. For employees with overseas workday relief you may treat at most 30 percent as outside PAYE this way.

Shadow payroll and net pay

In practice the posted employee usually stays on the payroll at home: they keep receiving their salary from the home company, often with allowances for housing and school. If UK income tax is due, a UK payroll runs alongside that pays out nothing but calculates, reports and pays the UK tax. That is shadow payroll. Benefits such as the flat in London belong in it too.

Many companies promise their assignees a net salary so that they neither gain nor lose from the posting. HMRC recognises this tax equalisation: under an Appendix 6 arrangement you run PAYE on an estimate of the year's total remuneration, grossed up, because tax you bear for the employee is itself taxable pay. If your home country also deducts tax on the pay, HMRC can provisionally credit the foreign tax in payroll under an Appendix 5 arrangement.

From 6 April 2027 company cars, fuel and medical insurance must in principle be taxed through payroll as you go. For globally mobile employees you can apply for an exception; HMRC issues the form from November 2026. How ongoing UK payroll works is in payroll and RTI.

Sources: GOV.UK: Globally mobile employees and PAYE; GOV.UK: CWG2 Employer further guide to PAYE and NICs 2026 to 2027; HMRC PAYE Manual PAYE81610: employer's presence in UK; GOV.UK: Employer bulletin October 2026