Beta This part of GOV.UK is being rebuilt – find out what this means

HMRC internal manual

PAYE Manual

From
HM Revenue & Customs
Updated
, see all updates

PAYE operation: international employments: legislation

Sections 689 and 690 Income Tax (Earnings and Pensions) Act 2003 (ITEPA 2003)

ITEPA 2003 affects employees from overseas working in the United Kingdom and employees who work for someone other than their employer. The relevant sections are

  • Section 689 - employees of a non-UK employer who work in the UK for someone who is not their employer
  • Section 690 - employees who are not resident or, if resident, not ordinarily resident in the UK.

Section 689 ITEPA 2003

Section 689 enables HMRC to require someone who is not the employer of an employee, but for whom the employee works, to account for PAYE on that employee’s earnings.

This requirement applies automatically if the PAYE regulations do not apply to both the actual employer and, if different, the person who pays the employee (unless the payer operates PAYE regardless).

Section 690 ITEPA 2003

Section 690 covers employees who are not resident or, if resident, not ordinarily resident in the UK.

It includes provisions which ensure the employer operates PAYE

  • On payments made to certain employees and directors who work both in the UK and abroad

Where

  • It is unclear at the time of payment exactly how much of the payment will ultimately be PAYE income.

PAYE81545 provides further advice.