Moved to US arm of company but UK payroll not set up yet - help

iwani590

I feel in a bit of a muddle with this and I'm quite worried about doing the wrong thing tax wise, I'll try and explain without confusing:

Up until August I worked for a UK company who are owned by a US company. The two are in the process of separating. For various reasons I was moved over the work for the US side earlier than they were really ready for me (it was meant to be after the separation is complete).

They are in the process of setting up a UK payroll company to pay me but it won't be done for a month or two yet.

Meanwhile, they have been wiring me my pay (they are calling it an 'advance') matching the net amount I previously received, so my received income is the same amount as before, as though tax, NI & student loan have been deducted. However those things have NOT been deducted or paid anywhere.

Their current intention is to pay me an extra lump sum to cover all the deductions that haven't happened, as soon as the UK payroll is set up (looking like December).

I am very worried as I don't know what I'm doing at all with this and don't want to get in any kind of tax trouble. Do I just complete a self assessment form once I get that lump sum and pay the tax/NI owed?

Someone told me that even one missed NI payment means I lose a year of state pension - is that true?

I spoke to student loan people and that at least seems fairly straight forward, they said the balance will just keep accruing interest until I am back with proper payslip deductions again.

What important things am I missing? Any help so gratefully appreciated!

SiliconChip

I can hopefully put your mind at rest over the impact of one missed NI payment, it's very unlikely to cause any problem for your state pension entitlement. And even if through some rare combination of events it didn't get included as a full year you would be able to pay the missing amount to regain it  (although if you expect to be working for around 40 years the chances are you'll have enough qualifying years anyway)

Dazed_and_C0nfused

Someone told me that even one missed NI payment means I lose a year of state pension - is that true?

Utter nonsense!

You don't even have to pay NI to get a qualifying year, earning at the LEL all year without paying any NI is sufficient.

Marcon

iwani590 said:

They are in the process of setting up a UK payroll company to pay me but it won't be done for a month or two yet.

Why not? They are making a meal out of something most companies manage in a day or two! They can use any commercial payroll provider on a temporary basis while they sort themselves out - or you could give them this link: https://www.gov.uk/payroll-software