Guidelines for payment for services in the UK or overseas

A printable checklist  (docx) of this flowchart is available to complete and submit with any request for payment.

 

 

resultj resulth resulti resultg resultf resulte resultd payroll hmrcpsc hmrc cest

Results of flowchart and next steps for engagement and payment process
Result Payment process Tax treatment Next steps and how to pay

D - Individual with employee status

Main payroll

Payroll process Tax and NI deducted
  • Set up the post on PeopleXD
  • Issue the Chancellor, Masters and Scholars (CMS) employment contract
  • If standard full or part-time hours contractual monthly payments made via payroll
  • If variable hours – payment made via payroll based on submitted timesheet 

E - Individual with employee status

Casual payroll

Payroll process Tax and NI deducted
  • Set up the casual post on PeopleXD
  • Issue the Letter of Engagement
  • Payment made via casual payroll based on submitted timesheet

F - Personal Service Company (PSC)

Inside off-payroll working (IR35) rules

Payroll process Tax and NI deducted
  • Set up the PSC on PeopleXD
  • Issue the contract
  • PSC issues an invoice to request payment
  • Send the invoice to the Payroll Team, with the CEST tool output (if completed)

G - Company/Personal Service Company (PSC)

Outside off-payroll working (IR35) rules

Accounts payable process Do not deduct tax or NI
  • Issue the contract for services
  • Supplier set up via New Supplier process
  • Company issues invoice to request payment (own or template available)
  • Invoice sent to Payments Team, with the CEST tool output (if completed)

H - Individual with non-employee status

Submitting invoices

Accounts payable process Do not deduct tax or NI
  • Issue the contract for services
  • Supplier set up via New Supplier process
  • Supplier issues invoice to request payment (own or template available)
  • Invoice sent to Payments Team, with the CEST tool output (if completed)

I - Individual with non-employee status

Submitting Off-payroll payment for services form

Accounts payable process Do not deduct tax or NI
  • Issue the contract for services
  • Supplier submits Off-payroll payment for services form (this form should be used for one off/small payments only, for more regular/larger payments an invoice should be issued)
  • Off-Payroll Payment for Services form sent to Payments Team, with the CEST tool output (if completed)
  • Supplier set up by Payments Team
J - Supply of goods Accounts payable process Do not deduct tax or NI
  • Issue the contract
  • Supplier set-up via New Supplier process
  • Supplier issues invoice to request payment (own or template available)
  • Invoice sent to Payments Team

 

Notes:

1. Limited Company or other corporate body invoices must contain the company name and be for payment to a company bank account. Ideally the invoice will also include a company registration number and/or VAT registration number. All UK incorporated companies should be registered at Companies House. If you are in any doubt process the invoice as if it comes from an individual.

2. The generally accepted definition of a Personal Service Company (PSC) is a limited company typically with a sole director, the contractor, who owns most/all of the shares. The contractor’s PSC generally supplies professional services to end user clients, either directly or via an agency. The services are delivered by the contractor who is also the owner and director of the business. All UK company directors should be registered at Companies House.

3. Contractors hired through a foreign PSC may be affected by the off-payroll working (IR35) rules (formerly the intermediaries’ legislation). There may also be fiscal implications abroad for which we invite administrators to contact the Payroll Manager.

4. A part-time lecturer whose engagement covers a complete academic term or longer may well have similar terms and conditions to a full-time lecturer. Many such part-time lecturers will be employees. A visiting lecturer who gives an occasional talk or short series of talks on a subject about which she/he has specialist knowledge and which is not part of the core curriculum will normally have rather different terms and conditions and is likely to be self-employed. Between those extremes, engagements should be considered on their own facts and the CEST tool must be completed to determine status.

5. Examined and Accredited courses do not include those that only issue a certificate of attendance or similar.

6. If the result relates to a visiting lecturer/trainer, please refer to our website for more information.

7. All payments to an individual processed through the Accounts Payable process will be recorded, where applicable, for declaration to HMRC in accordance with HMRC regulations.