If you are paying for a non-(UK)-resident performer to take part in your group's activities, make sure that you are aware of your legal obligations with our simple guide.
Legislation relating to this area was introduced in the Finance Act 1986. This legislation, which came into effect on 1 May 1987, can now be found in sections 555‑558 of the Income & Corporation Taxes Act 1988 and the Income Tax (Entertainers and Sportsmen) Regulations Statutory Instrument 1987 number 530.
Withholding Tax must be deducted from payments for any UK appearance of a non-resident entertainer. The rate of the tax mirrors the basic rate of UK Income Tax, currently 20%. So if a foreign entertainer invoices you for £1,000, you pay him £800, and contact the Foreign Entertainers Unit (see below) to arrange payment of the tax (£200) to them.
1. What counts as ‘payments’
For this purpose, ‘payments’ include not only the fee, but also the cost of any incidentals which the member group pays for, e.g. train/air fares, taxis or accommodation. However, if the total of such ‘payments’ in any one tax year does not exceed £1,000, or if the member group is making a payment which would be covered by the ‘Simplified List’ (please see below), there is no need to withhold tax but you may still have to return details of the payments to the Inland Revenue. Please note also that the £1,000 payment limit applies whether it is a single artist or a group of artists who are performing and whether the payment is being made direct to them or to someone else on their behalf.
Note that payments made directly to the provider of expenses (e.g. a hotel or an airline) will be subject to withholding tax on top of the amount payable, so in all cases you should ensure that you reimburse the artist directly for their expenses rather than the expenses provider.
2. What is a ‘Non-Resident’
There is sometimes a difficulty in knowing whether artists are ‘non-resident’ for UK tax purposes or not. In case of difficulty the artist or agent must specify which they are, and it might be advisable to get this in writing.
3. Exceptions: the simplified list
The UK agents of non-resident classical music artists can apply for their name to be included on the ‘Simplified List’. This is a list which is updated and issued by the Foreign Entertainers Unit annually. If an agent is included on the list you will not have to be responsible for deducting and accounting for the tax when you pay them. If, however, you are paying the artist direct or to someone whose name does not appear on the list, you will not be relieved from your obligations under the legislation.
4. Who should I contact with questions?
The Foreign Entertainers Unit (FEU) is the Inland Revenue office which deals specifically with the UK tax affairs of non-resident entertainers and it is concerned with events which take place throughout the whole of Great Britain and Northern Ireland and you should therefore refer any queries which you may have there and not to your local tax office. FEU is staffed by people who are used to dealing with the entertainment industry and it is their job to ensure that the legislation is applied properly and fairly.
The address to contact is:
Foreign Entertainers Unit,
Tel 0151 472 6488
Fax 0151 472 6483
5. Payer's guide
More information on this topic can be found in a booklet called ‘The Payer's Guide’ which is obtainable on request from FEU.
Making Music is grateful to the Foreign Entertainers Unit for its assistance in the preparation of this Information Sheet, and for their subsequent endorsement of it.
We hope you find this Making Music resource useful. If you have any comments or suggestions about the guidance please contact us. Whilst every effort is made to ensure that the content of this guidance is accurate and up to date, Making Music do not warrant, nor accept any liability or responsibility for the completeness or accuracy of the content, or for any loss which may arise from reliance on the information contained in it.