Switching from an Employer of Record to your own UK payroll

The same hire, at roughly a third of the service fee

An Employer of Record lets you put someone on the payroll in a country where you have no legal presence, fast. That premium is worth it at the start. It starts to look expensive once you are simply paying it every month for a person who is staying.

Most UK EOR platforms charge roughly £470 to £550 a month per employee, on top of salary, employer's National Insurance and pension. Running your own UK payroll for a single hire, through a DPNI scheme if you have no UK entity, costs a fixed £157 a month for a monthly-paid employee. Over a year that is roughly £6,000 against roughly £1,900, for the same salary, the same NI and the same pension underneath.

So for anyone you intend to keep, moving off the EOR usually pays for itself many times over. This is how that move works, and how to do it without leaving your employee short on payday.

Where you are moving to

There are two destinations, and which one applies comes down to a single question: does your company have, or want, a UK entity?

On the DPNI route the scheme handles Income Tax and National Insurance correctly, and a specialist runs it for you. You do not need a UK company for it. See what a DPNI scheme is for the full picture.

Most companies leaving an EOR for a single UK hire land on the DPNI route, because avoiding a UK entity was the whole point of the EOR in the first place.

The switch, step by step

Done in the right order, the change is invisible to the employee. Their pay lands on time, every time, and one month they are simply paid by you instead of by the platform.

1. Confirm the route. Own PAYE if you have a UK entity, DPNI if you do not. If you are unsure, this is the first thing we confirm for you.
2. Set up your own scheme with HMRC. For DPNI that is a manual application in the employee's name. It takes a little time to come through, so start it before you give notice to the EOR, not after.
3. Check the EOR contract. Look at the notice period and any offboarding fees or minimum term. This sets your timetable, so read it before you commit to a switch date.
4. Put the direct employment in place. The employee moves from being employed by the EOR to being employed by you, which means a new UK contract of employment. Continuity of employment and any accrued rights need handling with care rather than being lost by accident, so take proper employment advice on the wording. We keep this general here on purpose, because it is genuinely a legal point, not a payroll one.
5. Run the first payroll in parallel and reconcile. Line your first pay run up against the EOR's final figures, gross, tax, NI, pension, net, and confirm they match before you rely on it. This is the step that stops surprises.
6. Re-enrol the workplace pension. The pension moves too. Make sure the employee is enrolled under the new arrangement so there is no gap in contributions.
7. Offboard the EOR cleanly. Give notice per their contract, agree the final pay date, and make sure there is no overlap where both you and the EOR pay, and no gap where neither does. Timing this around a single payday is the whole game.

What to watch

• Continuity of employment. This is the one to get right. The aim is that the employee's service carries over rather than resetting to day one. Handle it deliberately, with advice, not as an afterthought.
• Timing around payday. Start the new scheme and give notice so the handover falls on a clean payroll boundary. No double pay, no missed pay.
• The EOR's notice and exit terms. Some carry a minimum term or an offboarding fee. Knowing this up front is what keeps the switch on schedule.
• Right to work and contracts. Right-to-work checks were done at the start, but the direct contract is new, so make sure it is in place before the first direct pay run.

What you save

The salary, employer's National Insurance and pension are the same whoever runs the payroll, so they are not part of the comparison. What changes is the service fee.

Work out your own numbers with the EOR cost calculator →

When not to switch

We would rather tell you straight. Stay on the EOR if the hire is short-term or still exploratory, if you genuinely want another party to hold the contract and liability, if you need zero UK employer obligations, or if you are standing up teams across several countries at once and want one vendor for all of them.

The switch is worth it when the hire is settled, UK-based and staying, and you are simply tired of paying a premium for it.

You keep your employee, they keep getting paid

We set up the scheme, line the first payroll up against the EOR's final numbers so nothing slips, sort the pension, and time the handover to a single clean payday. The monthly cost drops to a fixed £157 on monthly pay, and those are the 2026/27 rates with no VAT to add.

Tell us your situation and we will confirm the route and a fixed fee, honestly, including whether staying on the EOR is actually the better call for you.

See how DPNI scheme setup works →

Questions we get asked

Can I move my employee off an EOR onto my own payroll?

Yes. If you are keeping a UK-based employee, you can move them from the EOR onto your own UK payroll. With a UK entity that is a standard PAYE scheme; with no UK entity it is a DPNI scheme set up in the employee's name. The employee keeps being paid on time throughout if the handover is timed to a payday.

Will my employee lose continuity of employment when they leave the EOR?

Not if it is handled properly. Continuity of employment and accrued rights should be carried over deliberately as part of the move, which is an employment-law point worth taking advice on rather than leaving to chance. Payroll itself is the straightforward part.

Do I need to set up a UK company to leave an EOR?

No. If you do not want a UK entity, a DPNI scheme lets you employ your UK worker directly with no UK company, and a specialist runs the scheme for you. Setting up a UK company is only necessary if you want one for other reasons.

How long does it take to switch?

The main variables are the HMRC scheme setup and the notice period in your EOR contract, so start the scheme before you give notice. In practice it is a matter of weeks, timed so the handover falls on a clean payday.

How much cheaper is my own payroll than an EOR?

For a single UK hire, a typical EOR fee is around £470 to £550 a month, while a DPNI scheme run for you is a fixed £157 a month on monthly pay, quoted higher for weekly or fortnightly runs. Over a year that is roughly £6,000 against roughly £1,900, plus a one-off setup in year one. Salary, National Insurance and pension are the same either way.

Read next

• EOR versus your own UK payroll, on cost, the full comparison with a calculator.
• What a DPNI scheme is, the route for employers with no UK entity.
• DPNI scheme setup, what the HMRC application involves and how long it takes.
• What a UK employee really costs, salary, employer's NI and pension in one place.

This page is general information, not tax, legal or employment advice, and reflects the published rates for the 2026/27 tax year. Continuity of employment and contract terms are employment-law matters, so please take advice on your own position before acting.