This guidance is for 'Rights Holding Broadcasters' and 'Olympic Broadcasting Service' employers who employ non-resident individuals who are in the UK temporarily to carry out activities necessary for the broadcast of the Games.
It explains the:
On this page:
You are a qualifying employer if you are an employer within one of the specified categories listed below:
A Rights Holding Broadcaster is an organisation who has been granted exclusive television, internet or radio rights to broadcast the Games by the International Olympic Committee (IOC) or London Organising Committee of the Olympic Games (LOCOG).
The Olympic Broadcasting Service is the organisation responsible for producing international television and radio signals and providing broadcasters with the facilities and services necessary for the broadcast of the Games.
Non-UK resident individuals employed to carry out activities necessary for the broadcast of the Games are qualifying employees. The following section explains more about how you can check.
To qualify for the tax exemption employees must remain non-resident in the UK for the tax year in which they earn the income. The UK tax year runs from 6 April to 5 April.
If an employee has not been to the UK before and is here temporarily for the Games, it is likely they will be non-resident in the UK provided they do not spend 183 days or more in the UK in a tax year.
If an employee is in the UK for less than six months in a tax year they will normally be non-resident. But if they are a regular visitor to the UK they will need to consider the average length of their visits over the last four years up to and including the tax year in which the Games related income is earned. This average must be less than 91 days per tax year if they are to remain non-resident.
If an employee is in the UK for 183 days or more in any tax year they are resident here and the tax exemptions will not apply.
If you are a qualifying employer and you employ a qualifying employee then you can consider this exemption.
The exemption from tax is restricted to income you pay your employee for Games-related activity which is necessary for the broadcast of the Games. This income must be earned during the period 6 April 2011 to 5 April 2013 to qualify for the exemption.
Examples of the type of income that is exempt include:
Income earned outside of the exemption period 6 April 2011 to 5 April 2013 is not exempt.
Income you pay your employee for activities that are not related to the broadcast of the Games is not exempt. So if your employee carries out both Games-related and non-Games related work and you make one payment that covers both types of work, the tax exemption only applies to the part of the payment that relates to the income from Games-related work necessary for the broadcast of the Games. It is your responsibility as the employer to divide the payment and apply normal UK tax treatment to the non-exempt income.
Stefan receives one payment of £1,500 for 80 hours work from his employer. Of those 80 hours, he spent 60 hours editing footage of the Games to be broadcast and 20 hours editing footage of news items that were unrelated to the Games. The payment must be divided as follows: £1500 × 60/80 = £1,125, which qualifies as exempt income.
Normal UK tax treatment applies to income received for non-Games related work or for activities not necessary for the broadcast of the Games, so exemptions do not apply to this type of income. But under existing UK tax rules you may still not need to deduct tax and National Insurance from non-exempt payments.
Once you have decided that you are a qualifying employer and your employee is a qualifying employee there are three factors you must consider in order to establish whether or not you should deduct Income Tax from an employee's earnings. The three factors are:
If you are a non-resident Rights Holding Broadcaster and you are in the UK temporarily for a period of less than six months, you will not need to deduct UK Income Tax from employees' earnings. Although no UK tax is due on earnings, tax may still be due in your country of residence.
If you are a non-resident Rights Holding Broadcaster and you are in the UK for longer than six months to carry out activities necessary for the broadcast of the Games there is no requirement for you to deduct UK Income Tax from an employee's earnings, provided there is no permanent establishment in the UK.
Permanent establishment in the UK exists when business is carried on from a distinct fixed place, for example an office or a studio, for a minimum of six months. However, HM Revenue & Customs (HMRC) will ignore the presence of non-resident businesses and their employees between 30 March 2012 to 8 November 2012 if they're here to work on the Games. See the link to guidance on business profits below.
If you are a UK-based Rights Holding Broadcaster or your enterprise has a permanent establishment in the UK, then you have an obligation to operate Pay As You Earn (PAYE) against any non exempt payments to non-resident individuals.
PAYE is the system that HMRC uses to collect Income Tax and National Insurance contributions from employees' pay. If you employ a non-resident individual, who has come to the UK temporarily to carry out activities for your business which is necessary for the broadcast of the Games, then you may need to consider whether particular PAYE arrangements for short term business visitors apply. See the appropriate link below.
There is no National Insurance exemption specifically for Rights Holding Broadcasters. Foreign Rights Holding Broadcasters and their employees who are normally resident abroad, and are sent by their foreign employer to work temporarily in the UK to cover the Games, are mostly exempt National Insurance under the existing rules.
HMRC usually asks to see forms A1 and E101 and certificates of coverage issued by foreign social security authorities as evidence of a National Insurance exemption. These requirements are waived for people posted to the UK to work on the Games.
If you have checked the HMRC website, and you are still unable to resolve your query, you can contact the HMRC Employer Helpline.