Payroll and HR in the United Kingdom

Payroll and HR in the United Kingdom

Local Information

Local Time (LIVE):6:27 PM
Local Currency:$1 = £0.79
Business Language(s):English
Tax Year Dates:6th April – 5th April

 

According to the UK government, more businesses locate their EU business headquarters in the UK more than anywhere else in Europe. That’s unsurprising, with the UK predicted to become the largest economy in Europe by 2030 and its myriad of opportunities in different industries. There’s also the benefit of low corporate tax – 20%, the joint lowest in the G20.

Despite the UK’s many benefits for business expansion, new staff payroll, immigration and other aspects of international payroll and HR can be stressful to manage and organize. Luckily, FMP Global’s in-country teams have the expertise to help with the payroll and HR logistics of expanding your business.

Ready for International Expansion?

We will only use your information in regards to this enquiry


Details correct at time of publication. You should not rely on these details without first seeking professional international advice.

Employer Must-Dos

In the UK, the following reports must be submitted to strict deadlines

  • VAT Returns
  • Company Tax Returns
  • E.O.Y Reports
  • Employee Payment Summaries

Payroll in the UK

What tax considerations are there?

Everyone in the UK is subject to the same tax rate, no matter their residency status. However, a UK resident will be taxed on their worldwide income, whereas a non-UK resident will be taxed only on income earned in the UK. Businesses are subject to corporate tax (as mentioned above), VAT and potentially, Stamp Duty. Employees will need to pay income tax as well as National Insurance contributions (for benefits such as the NHS).

Autoenrolment

In the UK, employers have a duty to help employees save for retirement, abiding by the UK’s workplace pensions law. Businesses of all sizes are required to offer a workplace pension, and will need to undertake a number of processes to ensure complete compliance with the country’s legal requirements, considering implementation of schemes, assessment, communications and payments.

The minimum contribution rates currently stand at 5% (at least 2% paid by the employer), however this is set to rise next year to 8% (3% minimum contribution paid by employer).

Expenses and Benefits

Employers that provide expenses or benefits to employees may need to be declared to HM Revenue and Customs (HMRC) to pay tax and National Insurance on them.

Other Considerations

The National Minimum Wages in the UK are as follows: £4.35 for under 18s, £6.15 for 18-20, £7.70 for 21-24 and £8.21 for 25+ (the National Living Wage).

With holiday pay, UK employees are entitled to a minimum of 5.6 weeks paid annual leave (28 days for an employee working 5 days a week). This is divided between 20 holiday days and bank holidays.

HR in the UK

What are the regular working hours in the UK?

The maximum working hours in the UK are 48 hours (unless opted out). The typical full time working hours are around 40 hours a week, Monday to Friday, 9am to 5pm/5.30pm.

Employment Rights

Employees are entitled to a range of statutory employment rights in the UK, including rights such as the right to a written statement of terms, statutory minimum payments in the event of illness and forms of family-related leave. It also includes rights on termination.

Permission to work & Visas

Most foreign nationals coming to work in the UK (aside from countries in the European Economic Area) are required to apply for prior approval to work in the UK. This is in accordance with the UK’s Points-Based System for immigration (PBS).

Termination

Employees must be given at least the notice stated in their contract, unless they have been dismissed immediately. Employees can be dismissed immediately according to rights stated on the gov.uk website. These include the employee not being able to do their job properly or having a long-term illness that prevents them from doing their job.

business in belfast

 

HR and Payroll in London

London became the capital of England under the Romans in the 12th century, and many would argue that since then it has been one of the chief centres of business in Europe. Today, according to data collected by Trust for London, the capital city is home to 13% of the entire UK population; that is 8.8 million people. It attracts a huge proportion of business HQs; in fact, 55% of the world’s 500 largest companies have chosen London as their European HQ location.

London has fantastic transport links to the rest of the UK and indeed the rest of the world. There are 5 international airports – Heathrow, Gatwick, Stansted, Luton, and London City – train travel around Europe with the Eurostar, and 402km of London Underground tracks as well as National Rail lines.

HR and Payroll in Edinburgh

The Startups Cities Index in 2017 announced that Edinburgh was the number one city in the UK in which to start a business. The reasons for this are plentiful; office rental is affordable, internet connection is fast, and the widely-respected University of Edinburgh produces a great number of well-educated graduates every year. The small size (264km² compared to London’s 1,572km²) of the city is another attractive feature, as there are plenty of networking opportunities within close proximity, as well as access to talent.

In March 2019, it was reported that the registered business stock for Edinburgh had increased by 3.3% (650 businesses) in the last year. Edinburgh was the leading city in Scotland, in this respect. Edinburgh Airport was the busiest airport in Scotland in 2018, serving more than 14.3 million passengers in that year. The international airport provides access to global locations on a daily basis and is a mere 30 minute’s drive to Edinburgh city centre.

HR and Payroll in Belfast

Belfast is reported to offer office spaces at some of the lowest rental costs in Western Europe. This, paired with superfast broadband speeds and a well-educated workforce, make Belfast an attractive city for businesses looking to expand. Belfast City Council invites businesses to the area, offering several incentives. These include access to networks, planning consultation, and internationalisation and export opportunities. They also provide advice on Belfast business regulations and licensing.

With regards to transport, there are two airports – Belfast International Airport and George Best Belfast City Airport. The latter of these only serves the rest of the UK and Republic of Ireland. There are rail links to the rest of Northern Ireland and the Republic of Ireland, and regular buses in and around the city.

HR and Payroll in Cardiff

Cardiff is a well-loved city which is easy to navigate. At just 140km², and with a population of just less than 360,000, the Welsh capital city has long been a centre of industry. Today it is a centre of financial services, technology, science, and creative businesses. There is a significant culture of business start-ups, especially due to the prominence of government support in the way of both advice and finance.

It is a multi-cultural city with an ethos centred on welcome and friendliness, making networking prospects ideal for newcomers. Cardiff Airport offers flights to destinations all over the world, and the city’s Central Railway Station has links to London, Manchester and Bristol among others. There are also regular buses in and around the city.

HR and Payroll in Manchester

With a rich industrial heritage, the city of Manchester has long been a centre of commerce. Today, 530,000 people call the city home, as do the offices of more than 2,000 foreign-owned companies, including Kellogg’s, Siemens, and Google. Manchester is the UK’s second-largest centre of economy, and as such, it continues to attract foreign investment. The main industries in the city continue to be manufacturing and construction, as well as distribution, retail, and hospitality.

Manchester Airport is around 30 minute’s drive from the city centre and even less by train. Piccadilly and Victoria are the main train stations in Manchester, serving destinations in the rest of the UK. From these stations, it’s possible to use the city’s Metrolink tram network to get around the rest of Manchester.

Get more Information on International Payroll

Find out more about international payroll and the implications and considerations that come along with it, download our free guide to international payroll today.

Download Our Guide

FMP’s UK Payroll and HR Solutions

FMP Global are the international payroll and HR partners you’ve been searching for. Whether you’re looking for payroll and hr support in London, Edinburgh or Belfast, our in country team will help. Our priority is always ensuring your business remains compliant in line with the country’s legislation, so you can get on with the day-to-day. Our services include:

  • UK Employment Contracts
  • Payroll Processing
  • Handling of payments (salaries)
  • Annual declarations (lodging, apprenticeship & training taxes for concerned companies)
  • Relations with social bodies
  • Regulatory Compliance
  • Tax and Labor Law Consulting
  • Assisting in payroll audit (or payroll department audit)
  • Handling of confidential payroll
  • Assistance in company restructuring plan
  • Assistance in implementation of procedures
  • Assistance with start-up (in link with lawyers)

Stay Compliant - Payroll and HR Services in the UK

FMP Global’s international payroll and HR professionals are ready to help. We’ll help coordinate and manage your global payroll and HR.

Start your International Expansion Today