Modified PAYE for expatriate employees

An article in Tax Bulletin 81 (February 2006) explains that employers who operate Modified PAYE for their tax equalised employees need to re-apply under revised procedures before 6 April 2007. Where an application has not been made under the revised procedures before 6 April 2007, any modified arrangement governed by an earlier version of the procedure will be regarded as terminated with effect from the start of 2007-08.

Only employers that give the undertakings in an application made under the revised arrangement can apply for the new Modified NICs procedure that significantly reduces the administrative burdens that can arise over calculating and paying National Insurance in respect of tax equalised employees who come from abroad to work in the UK.