PAYE81501 - PAYE operation: international employments: overview

This 'International Employments' section of the manual covers problems that arise when the employer of an employee performing duties in the UK has no UK presence, or for employees who come to, or go outside, the UK to work.

Although not a statutory term, for the purposes of this guidance where an employee comes to, or goes outside, the UK to work they are referred to as a Globally Mobile Employee ("GME").

The Employment Income Manual explains how an employee's residence status for a tax year affects their liability on, to UK income tax on their employment income (see EIM40000+).

This section shows how the PAYE system needs to be adapted to fit international employers and globally mobile employees. Employers are required to operate PAYE on payments of PAYE income which they make during a tax year. When an employee is globally mobile this can affect the amount of their employment income which is PAYE income.

For example when an employee is not UK resident for a tax year and performs their duties both in and outside the UK, ordinarily only their employment income which relates to their UK duties will be chargeable to UK income tax. This means that only part of the employment income paid may be PAYE income.

As such, a GME may have income paid to them which is not taxable in the UK and so is not PAYE income. However, it may not be possible for the employer to determine the extent that the payment is PAYE when it is made.

Such uncertainty could make it difficult for an employer to correctly operate PAYE on payments they made to their employees.


There are specific provisions in Part 11 ITEPA 2003 which can apply to modify the operation of PAYE where an employee either works in the UK for an employer based outside the UK, or is globally mobile, to address any difficulties:

  • Section 689 - employees of a non-UK employer
  • Section 690-690C - internationally mobile employees
  • Section 690D-690E - qualifying new residents

Guidance of these provisions is set out in the International Employments section of the manual.