Do I need an Employer of Record to hire in the UK?

Five questions that settle it

1. Do you want another business to be the legal employer?
   Yes: that is exactly what an Employer of Record is for. No: go to question 2.
2. Does the person need to start within days?
   Yes: an Employer of Record can usually employ someone quickly. A start date alone need not decide it, though. We'd allow four to eight weeks for HMRC to set the scheme up, and that's our own estimate, not a figure from HMRC. If pay starts before the scheme is in place, payroll still runs every payday and is reported to HMRC late once the scheme exists. No: go to question 3.
3. Are you hiring in several countries at once and want one supplier for all of them?
   Yes: an Employer of Record often fits. No: go to question 4.
4. Does your company already have a UK company, branch or place of business?
   Yes: you may already be required to run UK PAYE yourself. See EOR, DPNI or a UK subsidiary. No: go to question 5.
5. Is your company based in the EU, the EEA or Switzerland?
   Yes: the direct route is an NI-only scheme in your company's name, or your own UK PAYE. No: the direct route is usually a DPNI, set up in the employee's name, or your own UK PAYE.

The routes that need no UK company

Employers based in the EU, the EEA or Switzerland

When someone works in the UK for an employer based in the EU and UK National Insurance is due, it is due on both sides, the employee's and the employer's, so the scheme is an NI-only scheme in the employer's name and not a DPNI or DCNI. Someone working in the UK for an employer in the EU usually pays UK National Insurance, unless they have a certificate of coverage (an A1) from that country.

Switzerland, Norway, Iceland and Liechtenstein each have their own social security agreement with the UK. Having no UK office or place of business doesn't on its own remove UK employer's National Insurance, because where a social security agreement applies, it treats the employer as if it were based in the UK.

Employers based anywhere else

The employee sets up a DPNI and pays both their income tax and their employee National Insurance to HMRC under one PAYE reference. HMRC's DPNI guidance includes employees of an overseas employer that has no UK address it pays wages from.

Any employer with no UK presence

A company with no UK presence doesn't have to run UK PAYE, but it can choose to run it in its own name.

One exception to all of this: if your employee will work for a UK business, such as your UK client, that business may have to run PAYE on their pay. We will ask HMRC for the scheme that fits your facts, and they may suggest a different one once they have the full facts.

What each answer costs

The major Employer of Record platforms publish starting prices of $399 to $699 per employee per month, about £297 to £519 at HMRC's October 2026 rate, with $599 (about £445) the most common (each platform's own pricing page, read 22 October 2026). A starting price is the lowest fee, and a quote can be higher. Our guide to Employer of Record cost per employee sets that fee beside the cost of your own UK payroll.

An Employer of Record becomes the legal employer and takes on the employer's duties; we run the payroll while you stay the employer, so the fees pay for different things. We are not VAT registered, so no VAT is added. When the scheme is in the employee's own name, the employee is our client and pays our fees.

When an Employer of Record is right for now

Many employers start with an Employer of Record and move to their own payroll later. If that might be you, read the notice and exit terms before you sign rather than when you want to leave. Our guides to when an EOR is the right answer and switching to your own payroll cover both ends.

Do I need an EOR: common questions

Do I need an Employer of Record to hire in the UK?

No, not unless you want another business to be the legal employer. If you are content to be the employer yourself, you can employ someone in the UK without a UK company and have the payroll run for you.

Do I need a UK company to employ someone in the UK?

No. A company with no UK presence doesn't have to run UK PAYE, but it can choose to run it in its own name. HMRC's direct schemes are the other route: a DPNI, set up in the employee's name, or an NI-only scheme in the employer's name where the employer is based in the EU, the EEA or Switzerland. We will ask HMRC for the scheme that fits your facts, and they may suggest a different one once they have the full facts.

How long does the direct route take to set up?

We'd allow four to eight weeks for HMRC to set the scheme up, and that's our own estimate, not a figure from HMRC. If pay starts before the scheme is in place, payroll still runs every payday and is reported to HMRC late once the scheme exists.

When is an Employer of Record the right choice?

When you would rather another business were the employer, when you are hiring in several countries and want one supplier, or when the role is a short trial and you would rather not register anything with HMRC yourself.

Read next

• Employer of Record alternative in the UK, when you need one and when you don't.
• Employer of Record cost vs your own payroll, with an interactive comparison.
• When an Employer of Record is the right answer, the cases where it fits.
• Switch from an EOR to your own UK payroll, how the move works.
• Pay a UK employee from abroad, the routes in plain terms.
• Employer of Record UK for US companies, cost and the direct route.
• Employer of Record UK: the complete guide, every EOR guide in one place.