- Overview: United Kingdom (UK)
- Global HR Compliance
- Global PEO and Payroll
- UK Work Visas, Work Permits, Immigration
- Contractor vs Employee: Which Is Better?
- Expand into the UK without a Company Set Up
Global PEO and Payroll in the United Kingdom (UK)
Global PEO and Payroll in the United Kingdom are becoming increasingly popular as the global economy expands. In light of this, businesses are looking for ways to minimize risks when expanding and hiring overseas.
Establishing your business entity in the UK is one option, but weighing the pros and cons carefully before investing any resources is essential. With so many options available, it can be challenging to determine which market entry and talent engagement model suits your situation.
An answer to this can be collaborating with a global PEO and payroll solution is to use a professional employment organization (PEO), which can supplement the necessary expertise and resources your in-house team lacks.
What Is a Global PEO?
A Global PEO (Professional Employer Organization) is a highly-specialized company that can make your global expansion hassle-free and eliminates risks. A Global Professional Employer Organization) helps handle international payroll, compliant employment contracts, compensations, benefits, severance, and termination in compliance with best practices and UK laws. A Global PEO can update clients on changes to United Kingdom employment law. A PEO savese businesses a lot of time and mone ando allows them to tap into a pool of highly talented and motivated workers who might otherwise be out of reach. So if you’re looking for ways to streamline your international hiring process, consider partnering with a PEO.
How Does a Global PEO Work? What Is the “Co-employment” Model?
Organizations that partner with a Global Professional Employer Organization (PEO) enjoy many benefits. By working with a PEO, businesses can take advantage of a co-employment relationship which can free up time and resources that can be better spent on strategic decision-making and business growth.Global PEOs are responsible for payroll, withholding and paying payroll taxes, managing compensation and benefits coverage, and providing HR compliance guidance.
The global PEO becomes a co-employer of the organization’s employees and PEO shares the employment responsibilities of the client organization. PEOs assume many of the administrative and HR compliance tasks that businesses would otherwise have to handle themselves, giving business owners and management teams more time to focus on running their companies.
In addition, Professional Employment Organisations can provide valuable services and expertise that businesses might not be able to access on their own. Using a PEO can be a great way for businesses to improve efficiency, save time and money, and gain access to valuable resources and expertise.
Acumen’s Global PEO and Payroll solution was designed especially for companies like yours to smooth the way for quick, easy, and risk-free business operations in the UK without establishing a legal business entity.
What Services Does Global PEO Provide?
If you’re looking for a streamlined option for hiring employees, testing markets, and responding to growing business needs in the UK, PEO/ EOR services could be right for you. With Acumen International Global PEO Services, we take on the burden of compliance so that you can focus on your business. We employ your selected candidates legally, following UK labour laws, so that you can get the talent you need quickly and without sacrificing quality.
A PEO can offer strategic guidance and services tailored to your company’s needs. These services can help your business grow safely and effectively. Here are some of the things a PEO can do for you.
- Human resources administration, including payroll, taxes, and benefits administration; employee training and development; recruitment; compliance training; background or education checks; time-keeping services;
- Regulatory compliance assistance, including payroll tax law and reporting requirements;
- IP protection and offboarding;
- Hiring and HR compliance services, helping you navigate through local regulations and avoid prohibited HR practices, including discriminatory job listings, Illegal criminal background checks, misclassified workforce, inaccurate payroll, and tax payments;
- Human resource support;
- End-to-end talent management, including recruiting, onboarding, engagement, performance management, and termination (upon employer approval);
- A PEO works with legal counsel to ensure that the company is updated on all employment law matters. This includes discrimination, wrongful termination, sexual harassment, whistleblower protection, non-compete agreements, severance agreements, and any other changes in the law.
5 Global HR Compliance Issues A Global PEO Can Help Address
- Continuous tax changes
- Worker misclassification risk
- Hour and wage compliance issues
- Compliance with immigration laws
- Keeping track of adherence to payroll and benefits regulations.
5 Benefits of Using Global PEO (Professional Employer Organisation)
- Facilitated and unified global mobility administration
- Centralized control over the global workforce
- Enhanced international employee and employer compliance
- Advice on favorable tax, benefit, and social security locations
- Reduced permanent establishment exposure risk
Acumen International – Trusted Professional Employer Organization in the UK
Acumen International is a Global PEO that provides an all-inclusive solution for business owners intending to enter the UK market simultaneously with reducing their new venture’s start-up costs and monthly overhead costs by streamlining administrative procedures saving thousands of pounds per year on tax and fees.
Navigating the UK legal system and adhering to regulations governing employment and taxation can be challenging for businesses, especially if you are not a native UK speaker. Partnering with Acumen International as a global Professional Employer organization (PEO) provides you with the local knowledge and support you need to conduct business in the UK without concern for legal and compliance risks.
Whether representing international client companies or taking your business operations abroad, Acumen International’s Global PEO and payroll service allow you to hire and payroll local and ex-pat employees in the UK. With Acumen in your corner, you can quickly and easily onboard and compensate your employees without risk of legal repercussions.
|Our Global PEO&Payroll||Client|
|Employment risks mitigation|
|Tax compliance & payroll processing|
|Incorporation costs||no need for own
|Coverage||190 countries||190 countries|
International PEO and Payroll Services in the UK
Compensating your local and ex-pat workforce in the United Kingdom and closely adhering to the UK taxation requirements can divert your attention and resources from activities that help your business grow. A reliable global employment solution like Acumen’s Global PEO and Payroll service can take a substantial burden off your shoulders so you can focus on running your company.
Outsourcing the administrative and compliance tasks involved in employee payroll is one approach, but we have a better solution. Acumen International offers a global PEO and payroll solution that goes beyond outsourcing. We hire and compensate your global workforce on your behalf and take care of all the payroll details while ensuring full compliance with the UK labour and taxation laws.
It is important to note that Acumen does not provide international global payroll services as a standalone solution but only as a part of our global PEO and Payroll solution.
Disclaimer: Any of the above information is subject to changes imposed by UK laws. To get the latest updates on taxation in the UK and in 190 countries worldwide, contact Acumen’s team of global employment experts.
International Global Payroll and Taxation in the UK
Personal Income Tax (PIT)
If an individual is resident and domiciled in the United Kingdom, they will be taxed on their worldwide income and capital gains.
If an individual is not a UK resident, they will usually be taxed on their UK-source income but will not generally be taxed on capital gains, other than in respect of UK property/’property-rich’ companies or carried interest, even if the asset is located in the United Kingdom. Gains regarding UK residential property owned by non-residents have been subject to UK CGT at 28% for several years. The tax charge has been extended to all UK property disposed of by non-UK residents and shares in ‘property-rich’ non-UK companies from April 2019.
In addition, where the asset is used for business purposes in the United Kingdom through a UK branch or agency, any gains are also subject to UK CGT. There are also special income and capital gains tax rules where a person has become a non-UK resident but returns to the United Kingdom within five years.
If an individual is resident but not domiciled (and not deemed domiciled) in the United Kingdom, they can elect for the remittance basis of taxation, in which case their non-UK investment income and capital gains are only taxed if they are remitted to the United Kingdom. This area of the UK tax regime has been considerably modified over the last few years and is covered in more detail below.
Personal Income Tax Rates
Income tax is charged at graduated rates, with higher rates of income tax applying to higher bands of income. Tax is charged on total income (from all earned and investment sources) less certain deductions and allowances. The graduated income tax rates vary slightly depending on whether the income is from earnings or investments. The main allowance is the personal allowance, which is GBP 12,500 in 2019/20 and 2020/21. Most individuals can claim a personal allowance unless they claim the remittance basis (see below) or their income is over GBP 100,000. The net amount after allowances is usually an individual’s taxable income.
Income Tax Bands and Rates
|Tax rate band||Income 2022/23 (GBP)||IIncome 2021/22 (GBP)|
|Starting rate for savings: 0% *||0 to 5,000||0 to 5,000|
|Basic rate: 20%||0 to 37,500||0 to 37,500|
|Higher rate: 40%||37,501 to 150,000||37,501 to 150,000|
|Additional rate: 45%||over 150,000||over 150,000|
Social security contributions
Social security payments are termed ‘national insurance contributions (NICs) in the United Kingdom. These are payable by employers, employees, and those with their own trades (the self-employed).
The primary rate of NIC applies to employees’ salaries (excluding benefits in kind) up to GBP 962 per week for 2020/21 (the ‘upper earnings limit’) (GBP 962 in 2019/20). No contributions are payable on the first GBP 183 per week (GBP 166 in 2019/20); between GBP 183.01 and GBP 962 per week, contributions amount to 12%. Earnings above the upper earnings limit attract a 2% charge.
All self-employed individuals pay contributions at 9% on earnings between GBP 8,632 and GBP 50,000 per annum. Profits above the upper limit attract a 2% contribution. Self-employed individuals also pay a flat-rate Class 2 contribution of GBP 3 in 2019/20 (2.95 in 2018/19) per week.
Relief against income tax is not generally available for NIC.
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