A UK company regularly sends middle/senior managers to its overseas operations to provide strategic support in key roles. These secondments range from 12 months to several years and expats are sent to various locations as the need arises – currently China, Japan, the USA and the UAE. During their overseas secondments, expats are paid partly in the UK and partly in the host country and benefits such as housing are usually provided in the host country. Xpatria helps this company by:

• Operating a tax equalisation programme whereby expats pay the company a ‘hypothetical tax’ i.e. same amount of tax as they would have paid had they remained working the UK. The company then uses this money to settle each expat’s tax liabilities in the host country. This leaves employees with a guaranteed net pay and ensures that they concentrate on their jobs, rather than worrying about their tax.
• Obtaining approval from HM Revenue & Customs that expats working overseas for more than a complete UK tax year can be paid without deduction of UK PAYE.
• Providing pre departure tax briefings to the expats so that they are aware of appropriate tax issues and filing deadlines before they start work overseas.
• Saving the company money by claiming tax relief on company funded accommodation, travel and subsistence costs for individuals intending to work overseas for less than a complete UK tax year.
• Where employees work overseas for less than a complete UK tax year, using tax treaties to reduce the UK tax due by offsetting overseas tax.
• Obtaining HM Revenue & Customs approval that expats can remain in the UK National Insurance system whilst working overseas; thereby exempting the expat and the company from social security contributions in the host country.
• Preparing and filing tax returns for the expats in their years of departure and eventual return, and directing any tax refunds to the company.
• Completing and filing HM Revenue & Customs’ departure forms. It is important to complete these forms correctly otherwise valuable tax reliefs can be lost.
• Providing training to UK staff so that they can manage the expats effectively and reduce costs.
• Operating a fixed fee annual query system so that company HR and finance (and the expats) can call whenever they have a question without fear of generating unplanned costs.

Occasionally this company receives employees from its overseas operations who come to the UK to perform specific roles. Xpatria has been on hand to guide them through this new process and ensure that the secondments are a success. See Coming to UK (Employers) for details of the ways in which we can help if you host employees from overseas.