Revenue Note for Guidance

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Revenue Note for Guidance

985D PAYE Non-resident employer

Summary

Where PAYE is not operated by or on behalf of a non-resident employer in respect of an employee who works in the State for another person, the person in the State will be responsible for the operation of PAYE.

Details

(1) For the purposes of section and sections 985E and 985F, “work”, in relation to an employee, means the performance of any duties of the office or employment of the employee and any reference to the employee working is to be construed accordingly.

(2) The section applies where—

  • an employee, during any period, works for a person (the “relevant person”) who is not the employee’s employer,
  • any payment of emoluments of the employee in respect of work done in that period is made by a person who is the employer or an intermediary of the employer or of the relevant person,
  • the person making the payment or, if that person makes the payment as an intermediary of the employer or of the relevant person, the employer is not resident in the State, and
  • income tax is not deducted or accounted for under PAYE, by the person making the payment or, if that person makes the payment as an intermediary of the employer or of the relevant person, the employer.

(3) Where the circumstances set out above apply, the relevant person is to be treated, for the purposes of PAYE, as making a payment of emoluments of the employee of an amount equal to the amount referred to below.

(4) The amount on which the relevant person is to operate PAYE is the amount paid by the intermediary to the employee, grossed-up if the payment is an “after tax” payment

(5) The section applies to notional payments that an employer is treated as having made under section 985A.

(6) A payment of emoluments of an employee is made by an intermediary of the employer if it is made—

  • by a person acting on behalf of the employer and at the expense of the employer or a person connected (within the meaning of section 10) with the employer, or
  • by trustees holding property for any persons who include, or class of persons which includes, the employee.

Relevant Date: Finance Act 2021