Hire in United Kingdom

United Kingdom

PEO &

Employer of Record

Hire employees remotely in United Kingdom without a local entity. We handle HR compliance, payroll & taxes so you can focus on your business.

Business Language

English

Salary Currency

British Pound (GBP)

Capital city

London

Time zone

UTC +1

EOR in United Kingdom

from $200/ month

Hire Employees in United Kingdom

NNRoad provides payroll & employer of record (EOR) services in United Kingdom to ensure that your business complies with local labor laws and regulations. We process monthly payroll and act as the Employer of Record, taking on all local employer liabilities.

Fast Hiring

Start working with your remote employees in a week.

Foreigner Visas

NNRoad assists with overseas foreign hires visa needs.

Platform

Access your payroll reports on our portal.

Employer of Record (EOR) in United Kingdom

Employer of Record (EOR) services are for companies who do not have a legal entity in United Kingdom, but who want to hire localy. Employment and full liability are outsourced to NNRoad.

1. Candidate Selection

Select the candidates you want to hire in United Kingdom.

2. Employee Onboarding

We sign a local labor contract with your employees based in United Kingdom.

3. Compliance & Payroll

We manage monthly payroll, mandatory benefits & all HR compliance in United Kingdom.

EOR service includes:

Hiring and termination of employees/local labor contracts (contract administration – engagement, extension termination and conversion to permanent hire).

All mandatory employer (and employee) contributions filed and paid for your EOR employees.

Payroll recording, reporting and administration.

Distribution of salaries to employees through direct deposit into their bank accounts.

Calculation, reporting, filing and processing of EOR employee’s individual income tax due.

Collecting and processing your employee’s invoices for business related expenses.

Guiding and organizing your expat employee’s work visa application too guarantee their successful onboarding.

Standalone Payroll in United Kingdom

Payroll services are for companies who have a legal entity in United Kingdom, and want to outsource their salary disbursement, mandatory benefits, income tax filing and mandatory reports.
PEO in the United Kingdom UK employer of record

Employer of Record Status in United Kingdom

Using an Employer of Record (EOR) to hire employees in the UK is a legally recognized and efficient method for companies looking to expand their workforce without establishing a local entity. An EOR acts as the legal employer, managing payroll, taxes, statutory benefits, and compliance with UK employment laws, such as those stipulated by the Employment Rights Act and the National Minimum Wage Act.

Hiring an Expat with an EOR in United Kingdom

For hiring foreign expats, an EOR also manages the necessary work visas and permits, ensuring compliance with immigration laws. This includes handling the right-to-work checks, visa applications, and adherence to all local employment regulations, allowing companies to onboard international talent efficiently and legally​.

Employee Income Taxes:

Individual income tax rates in United Kingdom are based on progressive tax brackets.

In the UK, there is the Personal Allowance (currently is £12,570) that is tax-free. If you’re a UK resident, you’ll need to pay tax on your overseas income. This includes earnings from employment, pensions, investments and other sources. Overseas income is taxed in the same way as UK income, so you’ll need to fill in a Self-Assessment tax return if you’re:

– self-employed

– a company director

– a partner in a business partnership

– have income from property or land

You may also be liable for UK income tax on foreign assets, even if you don’t receive any income from them.

Tax Brackets:

Sample Calculation

0%: 0 – £12,570
20%: £12,571 – £50,270
40%: £50,271 – £125,140
45%: Over £125,140
Single taxpayer yearly income = £100,000

0% * 12,570 = 0
20% * (50,270 – 12,571) = 7,539.80
40% * (100,000 – 50,271) = 19,891.60

Yearly income tax = 0 + 7,539.80 + 19,891.60 = 27,431.40 GBP

Employer Contribution

Employers must pay the National Insurance. The  contributions are on the employee’s National Insurance category letter and how much of the employee’s earnings fall within each band.

In the UK, employer contributions towards an employee’s pension are not tax-deductible. This means that employers must pay National Insurance on these contributions. The current rate of National Insurance for employers is 13.8%.

In addition to the employer’s National Insurance contributions, they will also have to pay the employee’s pension contributions. The employee’s pension contributions are tax-deductible, meaning that the employee will receive a tax relief on these contributions. The current rate of pension contribution for employees is 4%.

The NHS, a government-funded national healthcare system in the United Kingdom, provides free treatment to UK residents. Employees pay into this fund through obligatory National Insurance contributions. Employers in the United Kingdom are obligated to offer a private pension plan to all employees.

Pension Fund

In the UK, the pension system consists of both state-provided and private pension funds. The state pension, known as the Basic State Pension, is a flat-rate pension paid to eligible individuals based on their National Insurance contributions.

Private pension funds, also known as occupational or personal pension schemes, are established by employers or individuals to provide additional retirement income. These funds are typically funded through contributions from employees, employers, and sometimes the government. Private pension funds offer various investment options and payout methods to individuals, allowing them to accumulate savings for their retirement years.

Healthcare Insurance

Healthcare insurance in the UK is primarily provided through the National Health Service (NHS), a publicly funded healthcare system. The NHS is funded through general taxation and provides comprehensive healthcare services to all UK residents, regardless of their ability to pay. It covers a wide range of services, including consultations, hospital care, prescription medications, and emergency treatments.

UK income tax

Working Hours Per Week

Like many other European countries, the maximum working hours per week are 48. But the employee can choose to work more by opting out from the standard system.

Overtime

Employers are not required to compensate employees for working overtime. The average compensation for the total hours of work, however, cannot be less than the National Minimum Wage. Overtime pay rates and how they’re calculated are usually spelled out in the employment contract.

There are four different types of dismissal in the UK: fair dismissal, unfair dismissal, constructive dismissal, and wrongful dismissal.

  • Fair dismissals: must have a valid reason for dismissing the employee which includes: capability, conduct, and redundancy
  • Unfair dismissals: includes an inaccurate reason for dismissal, unfair reason, failing to give warning about the dismissal, and discrimination
  • Constructive dismissal: an employee resigns because an employer breached the employment contract. This could be a single serious event or a series of less serious events
  • Wrongful dismissal: An employer breaks the terms of an employee’s contract in the dismissal process, such as dismissing someone without giving them proper notice

    Severance

    Except in the case of redundancy, severance is rarely necessary in the United Kingdom. Other contributions, however, may be necessary in some cases.

    If the employee has been working for the employer for more than two years, he/she will usually be entitled to statutory redundancy pay.

    The employee will receive:

  • a half-wages week’s for every full year the employee was under the age of 22
  • one week’s salary for each complete year the employee was 22 or older but under 41
  • one and a half week’s pay for each full year the employees was 41 or older

    Notice Period

    The notice period depend on the length of service the employee had with the company:

  • 0 – 1 month service: No notice
  • 1 month – 2 years service: 1 week notice
  • 2 years – 12 years service: +1 week for each year
  • 12+ years service: 12 weeks notice

  • Employment Contract

    An employment contract can be a “written statement of particulars,” which is for employees with contracts that last a month or more. This statement will include the main conditions of employment.

    Probation Period

    Probation periods are common in the UK and typically last between three and six months. The main feature of the probationary period is that the employee will not normally be entitled to claim unfair dismissal if the employment is terminated as the employee requires two years’ service to bring such a claim.

    Annual Leave

    Most 5-day workers are entitled to at least 28 days of paid yearly leave every year. This equates to 5.6 weeks of vacation time. The amount of statutory paid vacation time is limited to 28 days. Employees who work six days a week, for example, are only eligible for 28 days of paid vacation.

    Sick Leave

    Day 0 – 3: No Sick Pay
    Day 3 – 28 weeks: Statutory Sick Pay (SSP)

    If you’re too sick to work, you can collect £96.35 per week in Statutory Sick Pay (SSP). Your company will cover it for up to 28 weeks.

    Maternity Leave

    Maternity leave is a statutory 52-week period. It’s made up of the following components:

  • Ordinary Maternity Leave is for the first 26 weeks of pregnancy
  • Additional Maternity Leave is available for a total of 26 weeks.
  • You do not have to take all the 52 weeks, but you must take two weeks off after the birth of the child (or 4 weeks if you work in a factory).

    SMP (Statutory Maternity Pay) is paid for up to 39 weeks of maternity leave. The employee will receive:

  • 90% of the average weekly earnings (before tax) for the first 6 weeks
  • £151.97 or 90% of the average weekly earnings for the next 33 weeks (whichever is lower)

    Paternity Leave

    The male employee is eligible for 1 or 2 weeks of paternity leave when the partner is having a baby.

    Shared Parental Leave

    Employees can share up to 50 weeks of leave and up to 37 weeks of pay between them. But they need to share the pay and leave in the first year after the child is born or placed with the family.

  • Public Holidays

  • New Year’s Day – January 3rd
  • Good Friday – April 15th
  • Easter Monday – April 18th
  • Early may Bank Holiday – May 2nd
  • Spring Bank Holiday – June 2nd
  • Platinum Jubilee Bank Holiday – June 3rd
  • Summer Bank Holiday – August 29th
  • Boxing Day – December 26th
  • Christmas Day – December 27th
  • Payroll Outsourcing in the UK
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