I work for a US or EU company with no UK office. Do I owe UK tax?

Yes. If you live and work in the UK, your employment income is normally taxable here regardless of where your employer is based. Your pay arriving with nothing deducted does not make it tax-free, it means the responsibility for accounting for UK Income Tax and National Insurance sits with you rather than being handled automatically at source.

Can I just file a Self Assessment tax return instead?

A Self Assessment can deal with the Income Tax, but it does not collect employee National Insurance, and as a UK employee you normally owe Class 1 primary NI. That is the gap most people miss. A DPNI or NI-only (DCNI) scheme collects both the correct tax and NI each pay period, which is the route HMRC expects for a UK employee of an overseas employer.

Whose name is a DPNI scheme in, mine or my employer's?

Under a DPNI scheme the scheme sits in the employee's name. That is why you, as the UK employee, can get it set up and running even if your overseas employer is not able or willing to deal with UK payroll themselves.

How long does it take to set up?

A DPNI or NI-only scheme is a manual HMRC application, it cannot be opened through the normal online employer registration, so it takes longer than a standard scheme. That is why it is worth starting around your first payday rather than letting it drift, so your tax and NI are right from the start instead of building up as arrears.

Insights › Working in the UK for an overseas employer

For employees

You work in the UK for a company abroad. Here's how your tax and NI actually work

Updated July 2026 · 6 min read

You live in the UK and you've taken a job with a company based overseas, maybe in the US, the EU or Australia. Your salary lands in your account in full, with nothing taken off for tax or National Insurance, and now you're wondering what you're supposed to do about it. You're right to check, and the good news is this is a well-worn path with a clear answer.

Why nothing is being deducted

Your employer is based abroad and has no UK entity, branch or place of business. A normal UK employer runs PAYE and hands you a payslip with tax and NI already taken off. An overseas employer with no UK presence usually can't operate PAYE in the standard way, so your pay reaches you gross.

Here's the important part: that does not make your income tax-free. If you live and work in the UK, your employment income is normally taxable here. What's happened is that the job of accounting for your UK Income Tax and National Insurance has landed with you, rather than being handled automatically at source.

The bit most people get wrong: it isn't just a tax return

The common assumption is "I'll sort it with a Self Assessment at the end of the year." A tax return can deal with the Income Tax. But it's the National Insurance that catches people out: as a UK employee you normally owe Class 1 primary NI, and Self Assessment doesn't collect that. Leave it and you can build up NI gaps that affect your state pension and certain benefits, plus a tax bill that arrives in one lump.

The route HMRC expects here is a DPNI scheme (or its NI-only cousin, DCNI). It's a direct-payment PAYE scheme that collects the correct Income Tax and National Insurance each pay period, giving you a proper payslip, just like any UK job. And crucially for you: a DPNI scheme sits in the employee's name. That's why you can get one set up even if your employer overseas can't or won't deal with UK payroll.

In one sentence: as a UK employee of an overseas company, a DPNI scheme in your name is how your Income Tax and National Insurance get paid correctly, not a year-end tax return on its own.

DPNI or DCNI, which one applies to you

There are two direct-payment variants, and which fits depends on how your tax and NI are being accounted for:

Scheme	What it covers	Typical case
DPNI	Income Tax and National Insurance	You settle both your tax and your primary NI through the scheme
DCNI / NI-only	National Insurance only	Income Tax is handled another way, NI still needs collecting

If you're not sure which is which, that's normal, we confirm it with HMRC as part of setting things up. Our DPNI vs DCNI guide walks through the difference, and the plain-English DPNI explainer covers the basics.

Why timing matters, the first-payday point

A DPNI or NI-only scheme is a manual HMRC application, it can't be opened through the normal online employer registration, so it takes longer to set up than a standard scheme. That's exactly why it's worth starting around your first payday rather than letting it drift.

Catch it early and it simply runs quietly in the background: right tax, right NI, every payday. Let it run for months first and you're looking at back-dated tax and NI to settle in one go, and the hassle of putting a scheme in place retrospectively. Sorting it at the start is far less stressful than untangling it later.

Worth knowing: a DPNI scheme isn't a way to avoid National Insurance, it's the correct way to pay it. The point isn't to reduce what you owe, it's to make sure the right amount is accounted for properly, so your record with HMRC stays clean and your state-pension years keep building.

What you actually need to do

In practice there are two ways this gets handled:

Your employer sets it up and runs it. Some overseas employers are happy to, and it's a good outcome. Many, though, don't have the UK knowledge or the appetite to run a UK payroll for one person.
You get it set up in your name and run for you. Because the scheme is in the employee's name, you don't need to wait for your employer to act. Someone still has to make the manual HMRC application and run the payslip each period, but that part can be handled for you.

Either way, the work is the same: the HMRC application, then a payslip each pay period with the right Income Tax and NI, reported to HMRC in real time. Want a sense of the full picture including employer costs? The cost of a UK employee guide lays out the numbers, and if you're weighing routes, the route finder points you the right way in a couple of clicks.

The bottom line

Working in the UK for a company abroad is completely fine, thousands of people do it. You just need the right scheme in place so your Income Tax and National Insurance are paid properly. It sits in your name, it's a specialist setup that HMRC handles manually, and the sooner it's in place the simpler your life. Get it running from the start and it takes care of itself.

Just started with an overseas employer?

We set up DPNI and NI-only schemes in the employee's name and run the payroll for you, the manual HMRC application handled, the right tax and NI every payday, transparent pricing published. Tell us your situation and we'll point you the right way, no obligation.

Talk to us about your situation

Or read the full DPNI explainer →

This guide is general information, not tax or legal advice, and reflects our understanding of the rules as at July 2026. Your circumstances may differ, please get specific advice before acting.