Polish companies are increasingly delegating employees to the UK in search of growth opportunities and access to new markets. This process presents a number of legal, administrative and tax challenges. Is it always necessary for an employee travelling to the UK for work purposes to have the appropriate visa? What are the employer’s obligations? What do you need to know and where can you go for help when delegating employees?
Delegating employees to the UK – are visas necessary?
In certain situations, an employer can post employees to work in the UK without the need for a visa.
Firstly, a visa is not needed for short business visits involving, for example, negotiations, meetings with clients or attendance at conferences. However, such a stay must not exceed 6 months and must not involve gainful employment that could be considered permanent professional activity in the UK.
Secondly, it is also possible for employees to be delegated for the purpose of repair or servicing and such duties can be performed by them on a tourist visa. However, the employee may not then engage in other gainful activities.
Thirdly, the delegation of an employee to the UK without a visa may also be possible under the terms of separate legislation or international agreements – e.g. in the context of international projects or services or secondments under inter-company agreements.
When does the delegation of employees to the UK require a visa?
Following the introduction of the new migration system in 2021, in most cases, work visas are the basis for legally and lawfully taking up employment in various sectors of the UK economy.
Depending on the duration of the delegation and the type of work carried out, different visa requirements apply. For example, English language skills are required for some visas. The regulations also stipulate a minimum reward that must be received in order to obtain a visa.
The possession of a visa is necessary when an employee:
- intends to work permanently or for an extended period of time in the UK (more than 6 months),
- is in work recognised as gainful employment in the UK and his or her stay is not of a tourist, educational or temporary nature,
- involves a position requiring specialised skills or qualifications, for example: construction, technical or administrative services.
What types of working visas apply in the UK?
Depending on the specific nature of the assignment, employees should obtain a specific variant of the work visa, such as:
- Service Supplier Visa – for employees carrying out service contracts;
- Temporary Work Visa – for employees performing tasks of a temporary nature;
- Skilled Worker Visa – for professionals employed in shortage occupations requiring specific professional qualifications (for example: IT, engineering, medicine).
Employees delegated to work in the UK must have the appropriate professional qualifications that match the requirements of the job. For some visas, the employee must prove English language skills. In addition, in order to be granted a visa to the UK, the company is required to provide the employee with a salary that meets the requirements set by the Home Office – annual salary thresholds vary between visa types.
Failing to obtain a work visa – consequences for employee and employer posting to the UK
The most serious risk associated with not having the correct visa is being refused entry to the UK. Employees who come to the UK without the required documents may be deported to Poland and their entry may be blocked for an extended period of time.
What’s more, if an employee violates immigration laws, he or she may face individual sanctions that include stopping entry to this country and financial penalties.
Consequences are also foreseen for employers who post employees to the UK without the required documents. Such a company may also receive a financial penalty, lose its licence to employ foreign nationals and, if breaches are detected, may be subject to detailed audits by the immigration service.
Registering your company as a sponsor. How do I get a certificate of sponsorship?
The company delegating employees must be registered as a sponsor in the UK to access work visas.
The licence of sponsorship is issued by the Home Office. To register a company and obtain a certificate of sponsorship, the employer must:
- apply for a sponsor’s licence on the government’s website – the form requires details of the company, its activities or plans for employment. The application must demonstrate that the company is actually operating in the UK,
- select the licence category that suits the company’s needs,
- submit the required additional documents that the Home Office may ask for (these include, but are not limited to, a PAYE number, financial reports or statements, or documents showing ownership or rental of business premises),
- pay for the issue of the licence upon receipt of a positive decision.
An employer who becomes a sponsor must also comply with certain obligations. First and foremost, he must be sure that the employee meets the criteria required for the issuance of a licence. It also has the responsibility to keep records related to the employee and to report regularly to the inspection authorities.
Skilled Work Visa, the procedure for obtaining a visa for skilled employees
The introduction of a new migration system linked to work visas is part of the UK’s wider strategy to control migration and attract talent at the same time. Through a more targeted and flexible system, the UK government seeks to balance the needs of the labour market and the control of the influx of foreigners. This in turn is expected to contribute to the country’s sustainable economic and social development.
In order to meet the conditions of the visa procedure and obtain skilled employee visas, he/she must prove that:
- will be doing work for an employer in the UK that has been approved by the Home Office and has a certificate of sponsorship;
- will be performing work that is on the list of qualified occupations;
- will receive the minimum wage – the amount depends on the type of work performed and the date of receipt of the CoS;
- can communicate in English at an intermediate B1 level according to the Common European Framework of Reference for Languages.
Such a visa is valid for up to five years.
Tax residency of employees delegated to the UK
Tax residency determines in which country a delegated employee to the UK must pay taxes.
Improper arrangements in this regard can lead to serious legal and financial consequences for both the employee and the employer. One of these is double taxation, which means that the employee will have to pay income tax in both the UK and Poland.
In addition, if HMRC considers that an employee or company has incorrectly established residency, this can lead to financial penalties or the need to pay interest for late tax payments.
Other risks associated with incorrectly establishing tax residency include, for example, ineligibility for tax credits or increased administrative costs associated with the need to issue adjustments to tax returns.
Tax residency versus exemption 183 days
If an employee stays in the UK for more than 183 days in a given tax year, he or she is deemed to be tax resident in the UK. It is then in the UK islands that he or she will account for income earned in the country.
If, on the other hand, the employee does not stay in the UK for more than 183 days, he works for a Polish company which bears his expenses, he may be exempt from UK income tax. In order for an employer or employee to prove that he or she has been on secondment for less than 183 days, it is necessary to collect documentation that proves the number of days of stay and the place of tax residence. This can include airline tickets, travel bookings, border crossing documents, hotel or flat rental invoices or registration in IT systems.
Social security contributions of a delegated employee
Employees who work in the UK for a certain period of time need to know where they should pay their national insurance contributions – Poland, the UK or both?
It all depends on the type of employment contract, the length of stay and the applicable international agreements between Poland and the UK. If an employee stays in the UK for more than 2 years, he/she may be required to pay contributions in the UK. In this case, the company should register him/her in the National Insurance system and pay social security contributions in the UK.
After Brexit, Poland and the UK signed an agreement that regulates where social security contributions should be paid for employees delegated between the two countries. The agreement aims to avoid double taxation – an employee delegated to work pays social security contributions in only one country.
Special rules apply to so-called detached workers, i.e. employees seconded by a company to perform temporary or short-term tasks abroad. Such individuals may be exempt from paying contributions for the first 52 weeks provided that:
- do not have UK resident status;
- generally perform work outside the UK for an overseas employer;
- the employer has sent them to the UK for a specified period;
- during their stay, they continue to work for the foreign employer.
How to avoid mistakes related to delegating employees?
The UK, like other countries, has complex legal regulations concerning visas, tax residency, employee delegation, and social insurance contributions.
The rules change regularly, making it challenging to navigate these regulations without proper knowledge, which can lead to serious mistakes. Employers running a Polish business in the UK must therefore clearly understand in which country income will be taxed and what obligations the regulations impose regarding the delegation of employees to the UK.
A lot depends on the duration of the assignment, the employee’s tax status, and the double taxation agreement between both countries. Attempting to delve into the regulations independently, without appropriate education and practical experience, carries a high risk of making errors. Therefore, entrusting this task to experts is far more beneficial.
How can our accounting office support you in the process of delegating employees to the UK?
We have been providing accounting services to Polish entrepreneurs operating in the UK for over 15 years. Our employees have gained their qualifications in the UK, so you can be sure that your bookkeeping will be carried out in accordance with current legislation.
- We provide comprehensive visa, tax and accounting advice to Polish companies posting employees to the UK;
- We prepare documentation;
- We assist with sponsor registration;
- We offer expert guidance on meeting visa and tax requirements and promptly respond to any questions.
Contact us now, gain confidence in meeting all your employee delegation requirements and free up your time to further develop your business.
