A Japanese company regularly sends junior/middle managers to work at its UK subsidiary to assist with design and production, and to gain experience of working overseas. These Japanese expats typically spend 1-3 years working in the UK before returning to Japan. During their UK secondments, they are paid partly in the UK and partly in Japan, and benefits are also provided in both countries. Xpatria helps this company by:
- Operating a tax-only payroll to calculate the UK tax due on the Japanese expats’ total income and benefits. The tax is paid by the company and so is ‘grossed up,’ with the result that the employees’ net pay is guaranteed and they can concentrate on their jobs, rather than worrying about their UK tax.
- Saving the company money by claiming tax relief on company funded accommodation, travel and subsistence costs for individuals intending to stay in the UK for less than 2 years.
- Reducing company administration by preparing and filing year end payroll and benefits forms with HM Revenue & Customs to report income and benefits from the UK and Japan.
- Preparing and filing tax returns for the Japanese expats, and directing any tax refunds to the company. The tax returns also contain deductions for contributions to the Japanese pension plan, which reduces the company’s grossed up tax burden.
- Completing and filing HM Revenue & Customs’ arrival and departure documentation.
- Obtaining exemption from operating PAYE for short term visitors to the UK.
- Projecting expat costs to assist with internal budgeting.
- 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 can call whenever they have a question without fear of generating unplanned costs.
As their business has expanded, the UK subsidiary has now started to send UK employees on secondment to Japan and Germany. Xpatria has been on hand to guide them through this new process and ensure that the secondments are a success. See Leaving the UK (Employers) for details of the ways in which we can help if you are sending employees to work overseas.