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16 April 2024

Short Term Business Visitors (STBV) – Are you compliant? 

Are you thinking about taking advantage of the expertise of those based overseas? Do you already have staff coming to the UK for short periods of time to undertake specific pieces of work or to attend meetings?  

Short Term Business Visitors FPM Image


Now more than ever, Global Mobility forms a key part of strategic business planning.  But there’s often a misconception that no tax liability or reporting requirement exist in relation to STBVs working in the UK, and that the double tax treaty relief applies automatically. But in reality, there are many factors that impact the tax, social security, and immigration compliance obligations for your business in the UK.  

Strictly speaking, if an individual physically works in the UK, then they give rise to a UK income tax charge in relation to their earnings associated with the UK workdays. Furthermore, if the individual is working for an employer who has a place of business in the UK, then the employer will be obligated to withhold via the PAYE system. As this continues to be an area of focus for HMRC, it is imperative that you have reviewed the position, are aware of your obligations and that you remain compliant in the UK. 

What are the requirements for Short Term Business Visitors?

As detailed above UK companies and branches, often have an obligation to operate PAYE to collect any income tax due on STBVs’ earnings. However, it’s possible for UK businesses to apply for a for a relaxation of the PAYE requirements in respect of their STBV population. 

There are two key payroll related relaxations to assist employers in addressing PAYE obligation in respect of STBVs: 

  • EP appendix 4 (STBV agreement) and 
  • EP appendix 8 (PAYE special arrangement for short term business visitors) 

What is it and what does it mean?

EP Appendix 4  

Providing specific criteria is met, individuals who are primarily employed overseas but come to the UK for short periods of time as detailed above, may fall within the Short-Term Business Visitors (STBV) legislation. This allows for an exemption to apply, removing the requirement for the employer to operate UK PAYE on these individuals. 


For the STBV legislation and exemption to apply, it is important that the following conditions are met. 


  • The individual is resident in a country in which the UK has a Double Taxation Agreement  
  • The individual comes to work in the UK for a UK company or the UK branch of an overseas company, or is legally employed by a UK resident employer, but economically employer by a separate non-resident entity. 
  • The individual is expected to stay in the UK for 183 days or less in a 12-month period. 


In addition, the employer must have approval from HMRC to operate this exemption known as a STBV Agreement. The STBV agreement details the additional criteria that must be met as per HMRC legislation. HRMC approval is then obtained by applying to HMRC. 


Although there is no requirement to operate PAYE on STBVs, under this exemption, HMRC require employers to complete annual reporting by 31st May following the end of the tax year in which the individuals were present in the UK. The reporting required is dependent on the number of days that the individual was present in the UK during the year. 

EP Appendix 8

The EP Appendix 4 only relaxes the PAYE requirements for individuals that meet the criteria of a relevant Double Taxation Agreement. It does not cover non-resident employees employed by a foreign branch of a UK company, individuals coming from non-tax treaty countries or where the treaty conditions are not met (e.g. due to a costs recharge). In these circumstances, the only option for a Company is to operate PAYE. 

The EP Appendix 8, Annual PAYE Scheme, was introduced for employers of having to deal with employees that do not qualify for STBV treatment. It allows them to account for their visits to the UK for the whole tax year and only operate PAYE at the tax year-end, with tax payable and the associated payroll reporting to take place at month twelve. Again, the application sets outs the criteria for the different categories of visitors. 

You will need to make an application to operate a scheme, then report, calculate and pay the appropriate tax by 31 May following the end of the tax year. 

How we can help you

Global tax and social security compliance is increasingly an area of focus for HMRC, and alongside our Tax team the Global Employment Taxes team at AAB can help you prepare. We can assist by reviewing your current population, reviewing your processes for identifying any travel, by making the necessary applications to HMRC and by completing any annual filing requirements.  If you require any assistance with either obtaining a STBV agreement or completing the annual reporting, please do not hesitate to contact a member of the team.

In addition to reporting, our colleagues at AAB can also assist with the ongoing tracking of mobile individuals, by automating this through our digital solutions or developing policies which are suitable for your business. If you think this would be of interest, please reach out to Tom Gee to schedule a discussion or a demo.  


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