The UK Country Guide 2023
The United Kingdom is a sovereign country in Europe, which comprises England, Wales, Scotland and Northern Ireland. It is home to both bustling cities and quaint countryside villages, great cultural diversity, and fascinating historical sites; the weather is mostly temperate, but it can get rainy during the winter.
The UK has a flourishing economy, which means large amounts of work opportunities; however, work visas can be pricey, and requirements stringy. While the UK has a high allowance of vacation days, the work-life balance tends to be skewed towards work, with many people working overtime. Healthcare in the UK is widely available and mostly free; there is lots of public transport (although you might need a car when living nearer the countryside), free school education, and strong labour laws.
- Capital: London
- Spoken Languages: English (Irish, Welsh, Scottish as minorities)
- Currency: Great British Pound (GBP)
- Minimum monthly wage: GBP 1,600 (Gross)
Citizens of EU/EFTA Member States and Switzerland can enter the UK with an identity card or a valid passport for short stays; other foreign citizens need a visa.
Work Permit / Residence Permit
Foreign nationals wishing to work in the UK must obtain a work visa. To qualify for a long stay visa, the individual has to score at least 70 points through a points-based system; the base requirements are a job offer from a licensed sponsor (20 points), at least medium-level English language skills (10 points), and a job at an appropriate skill level (20 points). The rest of the points can be made up by earning a salary of at least GBP 25,600, having a job in an official shortage occupation, or having a Ph.D in a STEM subject relevant to the job. Applications can be done online, or via a UK visa application centre.
In addition, the individual must pay an Immigration Health Surcharge (IHS) per year of the visa in order to be able to access the National Health Service in the UK. The cost varies between £470 and 624 per annum.
After arriving in the UK, individuals must collect their Biometric Residence Permit (BRP) within 10 days, and register with the police within 7 days.
Social Security Registration
Individuals should apply to receive a National Insurance Number if they are planning to live and work in the UK; this can be done online.
Average working hours in the UK are calculated over a “reference” period, normally 17 weeks; this means employees can work more than 48 hours one week, as long as the average over 17 weeks is less than 48 hours a week.
- New Year’s Day, 01 Jan
- Good Friday, (Not a standard date, usually March/April)
- Easter Monday, (Not a standard date, after Good Friday)
- Early May Bank Holiday, 1st Monday of May
- Spring Bank Holiday, Last Monday of May
- Summer Bank Holiday, Last Monday of August
- Christmas Day, 25 Dec
- Boxing Day, 26 Dec
If a public holiday falls on a weekend, the next working day will be a holiday in lieu of the original day.
Full-time employees working in the UK are entitled to 28 days of paid annual leave per year, which is equivalent to 5.6 working weeks of holiday.
The Supreme Court has confirmed that part time and part year workers employed for a full leave year are entitled to receive 5.6 weeks of paid holiday, irrespective of the number of weeks that they actually work during the leave year and even if that means they are entitled to proportionately more holiday than full-time colleagues.
Other aspects of holiday entitlement
Workers have the right to:
- get paid for leave
- Accrue holiday entitlement during maternity, paternity and adoption leave
- Accrue holiday entitlement while off work sick
- request holiday at the same time as sick leave
Statutory Sick Pay
Employees may be eligible for Statutory Sick Pay (SSP), which is £99.35 a week for up to 28 weeks.
An employer can offer more if you have a company sick pay scheme but cannot offer less. Company schemes are also called ‘contractual’ or ‘occupational’ sick pay and must be included in an employment contract.
To qualify for Statutory Sick Pay (SSP) employees must:
- have an employment contract
- have done some work under their contract
- have been sick for 4 or more consecutive days (including non-working days) – known as a ‘period of incapacity for work’
- earn an average of at least £123 per week
- give the employer notice and proof of illness when needed
Maternity / Paternity leave
- Maternity: 52 weeks; 26 weeks of ordinary maternity leave, and 26 weeks additional leave. Maximum 11 weeks before date of birth, and compulsory 2 weeks after the birth. First 39 weeks are paid at 90% or regular salary.
- Paternity: 1-2 weeks within 56 days of the birth.
You and your partner may be able to get Shared Parental Leave (SPL) and Statutory Shared Parental Pay (ShPP) if you’re:
- having a baby
- using a surrogate to have a baby
- adopting a child
- fostering a child who you’re planning to adopt
You can share up to 50 weeks of leave and up to 37 weeks of pay between you.
Statutory Maternity Pay (SMP)
Statutory Maternity Pay (SMP) is paid for up to 39 weeks. You get: 90% of your average weekly earnings (before tax) for the first 6 weeks. £156.66 or 90% of your average weekly earnings (whichever is lower) for the next 33 weeks.
Termination & Severance
After termination of employment, an employee is entitled to severance pay provided they have worked with the employer for at least two years. The amount of severance pay per year of service depends on the employee’s age during that year.
Being dismissed for misconduct does not count as redundancy, so an employee would not get statutory redundancy pay if this happened.
|Age of Employee||Severance Pay|
|Under 22||0.5 week’s pay per year of service|
|Over 22 and up to 41||1 week’s pay per year of service|
|Over 41||1.5 week’s pay per year of service|
The employer may choose to pay the employee in lieu of a notice period, depending on the circumstances.
|Duration of Service||Notice Period|
|Over 1 month and up to 2 years||1 week|
|Over 2 years and under 12||1 week per year of service|
|Over 12 years||12 weeks|
The contractual notice period may be longer than the statutory minimum notice period but may not be shorter. A failure to give the required notice is likely to constitute a breach of contract.
Employee National Insurance contributions are deducted automatically from the wage (through the PAYE system); employer contributions are paid by the employers themselves. The contribution amount is progressive and depends on the salary.
If you’re employed:
You pay Class 1 National Insurance contributions. The rates for most people for the tax year 2023 to 2024 are:
|Your pay||Class 1 National Insurance rate|
|£242 to £967 a week (£1,048 to £4,189 a month)||12%|
|Over £967 a week (£4,189 a month)|
You’ll pay less if:
- you’re a married woman or widow with a valid ‘certificate of election’
- you’re deferring National Insurance because you’ve got more than one job
If you’re self-employed:
You pay Class 2 and Class 4 National Insurance, depending on your profits.
|Class||Rate for tax year 2023 to 2024|
£3.45 a week
9% on profits between £12,570 and £50,270
2% on profits over £50,270
If you’re employed and self-employed:
You might be an employee but also do self-employed work. In this case your employer will deduct your Class 1 National Insurance from your wages, and you may have to pay Class 2 and 4 National Insurance for your self-employed work.
Directors, landlords and share fishermen:
There are different National Insurance rules if you’re a:
- director of a limited company
- landlord running a property business
- share fisherman, for example you’re working on a British fishing boat but not under a contract of service
UK State pensions are funded by contributions to the National Insurance, and individuals who have made at least 10 years’ worth of contributions are eligible.
Taxation in the UK
The current tax year is from 6 April 2023 to 5 April 2024.
Income Tax rates and bands:
England, Wales, Northern Ireland
The table shows the tax rates you pay in each band if you have a standard Personal Allowance of £12,570.
|Bond/Taxable Income (GBP)||Rate (%)|
|Personal Allowance (0 – 12,570)||0%|
|Basic Rate (12,571 – 50,270)||20%|
|Higher Rate (50,271 – 125,140)||40%|
|Additional Rate (over 125,140)||45%|
You can also see the rates and bands without the Personal Allowance. You do not get a Personal Allowance on taxable income over £125,140.
The table shows the 2023 – 2024 Scottish Income Tax rates you pay in each band if you have a standard Personal Allowance of £12,570.
|Bond/Taxable Income (GBP)||Rate (%)|
|Personal Allowance (Up to 12,570)||0%|
|Starter Rate (12,571 – 14,732)||19%|
|Basic Rate (14,733 – 25,688)||20%|
|Intermediate rate (25,689 – 43,662)||21%|
|Higher rate (43,663 – 125,140)||42%|
|Top rate (over 125,140)||47%|
You do not get a Personal Allowance on taxable income over £125,140.
The annual income tax return should be filed by the 5th April for the previous tax year, either online or in paper form. Individuals who only receive income from wages (through the PAYE system) do not need to file a tax return.
The UK has international double taxation agreements with multiple other countries, which can reduce tax liability on certain incomes, or alleviate the need to pay tax on the same income in both countries.
All individuals living and working in the UK are entitled to benefits from the National Health Service, which is funded by taxation and contributions from the National Insurance contributions.
Cost of Living
The cost of living in the UK is one of the highest in Western Europe. The estimated monthly cost for a single person is around GBP 2,300 – 2,600, with 1,600 – 2,000 going to rent.
How We Can Help
We provide a full set of services in the United Kingdom allowing corporate clients, recruitment agencies and professional contractors to operate in an optimal manner while ensuring that all local employment obligations are taken care of.
Access Financial offers the following solution in the United Kingdom:
- Employed/EOR Solution
- Limited Company Solution
If you would like to discuss how Access Financial can help in the UK, please contact us.
We have prepared this as a guide only; it does not form part of an offer. Please request illustrations based on your specific case from one of our solution managers.