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When does the UK government allow or not allow a 52 week exemption

Resolved Question:

When does the UK government allow or not allow a 52 week exemption of employee NIC contributions? Specifically my company is transferring personnel from India on 2/3 year business visas.
Submitted: 10 months ago.
Category: Tax
Expert:  Sam replied 10 months ago.
HI Thanks for your question Usually when an employee goes to work abroad for more than a full tax year (with visits back to the UK that amount to less than 91 days, none of which are for work purposes) but remains paid from the UK- then the first 52 weeks of that position sees National Insurance to remin due and deducted - but after that then the pay can be made NI free (and this all ties in with the completion of form P85 for HMRc which also looks at tax exemption too) But both instructions (for tax and National Insurance) have to be advised on by HMRC Let me know if I can assist further Thanks Sam
Customer: replied 10 months ago.

Hi Sam, no these are employees being transferred FROM India to the UK.

Expert:  Sam replied 10 months ago.
Hi Thanks for your response and correction Then they will become liable to Uk tax and National Insurance from the first pay day in the UK - if they are to be paid from the UKIf paid from abroad, then they will need to be treated as UK employees and a new employers scheme set up to make the tax and National Insurance deductions ThanksSam
Customer: replied 10 months ago.

What I am unclear about is this comment on a website:


Exceptions for employees sent from countries outside the EEA and without a Reciprocal Agreement or Double Contributions Convention


If an employee is sent by their normal employer from one of these countries to work in your business, and if of the following conditions apply, then no NICs are due for the first 52 weeks after the employee arrives in the UK:



  • the employee is not ordinarily resident or working in the UK

  • they have been sent to work here temporarily by an overseas employer

  • the overseas employer has a place of business outside the UK (it doesn’t matter if they also have a place of business in the UK)

  • the worker continues to be employed by the overseas employer


Once the period of 52 weeks finishes, you should begin deducting NICs from these employees in the normal way.

Expert:  Sam replied 10 months ago.
HI But we have a double taxation agreement with India - signed in 1993 re the double contributions conventionSo National Insurance will be due However even if that treaty was not in place then - They may become ordinarily resident based on what you advsie due to how long they will work and live here in the UK and will work IN the UK and if they are paid from the Uk - then the UK employer will employ them not the overseas one Thanks Sam
Customer: replied 10 months ago.

OK, great. Thanks.

Expert:  Sam replied 10 months ago.
HI You are welcome and please do take the time out to rate me for the level of service I have provided. (or click accept) Thanks Sam
Sam, Accountant
Category: Tax
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Experience: 26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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