PAYE & payroll · 8 min read
How to Register as a UK Employer (PAYE) When You Do Not Have a UK Address
How foreign companies register with HMRC for PAYE and run their first UK payroll — even when the UK company only has a virtual registered office and every director sits overseas.
Hiring your first UK employee as a foreign company raises a question almost every founder gets stuck on: how do you register as a UK employer for PAYE (Pay As You Earn) if your company does not yet have a UK trading address? The short answer is that you can — but the process has extra steps for non-resident employers, and it takes longer than most people budget for.
What PAYE registration actually is
PAYE is HMRC's system for collecting Income Tax and National Insurance from employee wages. Every UK employer — including a UK subsidiary of a foreign company — must register before the first payday. It is separate from Companies House incorporation and separate from Corporation Tax registration; each has its own process and timeline.
Why the no-UK-address problem comes up
Most foreign SMEs incorporate their UK company using a registered office service — often just a mail-forwarding address — before they have staff, premises or a physical UK presence. That is normal and does not block incorporation. But HMRC systems and some banking or payroll providers are built around the assumption that an employer already has UK operational infrastructure: a business bank account, a fixed place of business, sometimes a UK contact number that is not a mobile forwarding line. None of these are legal blockers, but they slow verification.
Step-by-step: registering for PAYE as a foreign employer
1. Incorporate the UK company first
PAYE registration requires an active UK company registration number from Companies House. You cannot register for PAYE before this exists.
2. Register for Corporation Tax
Not strictly a PAYE prerequisite, but HMRC's systems cross-reference this and doing it out of order tends to create delays later.
3. Open a UK business bank account
Not legally required to register for PAYE itself, but functionally necessary — you cannot run payroll without a UK account to pay staff from, and most payroll software expects one. This is usually the longest step for non-resident directors, so start it early and in parallel with everything else.
4. Register as an employer with HMRC
This can be done online. You will need your company registration number, details of the first employee's start date, and an estimate of your annual payroll. HMRC issues a PAYE reference number, which typically takes 5 working days to a few weeks depending on volume — non-resident director applications sometimes take longer due to manual verification.
5. Set up a payroll system
You need software compatible with HMRC's Real Time Information (RTI) reporting requirement — which means submitting payroll data to HMRC on or before each payday, not after.
6. Register employees and run first payroll
Once your PAYE reference is issued, add employees, calculate deductions and process payslips.
Timing: build in more runway than you think
A common mistake is treating PAYE registration as something you can sort in the same week as sending an offer letter. In practice:
- Company incorporation: 24–48 hours.
- Corporation Tax registration: a few days.
- Business bank account: often 2–4 weeks for non-resident directors.
- PAYE registration: 1–3 weeks, sometimes longer if HMRC needs additional verification.
Stacked together, that is realistically 4–6 weeks minimum from 'we have decided to hire in the UK' to 'we can legally run payroll' — longer if any step hits friction. If you have a start date already agreed with a candidate, work backwards from it, not forwards from your incorporation date.
What foreign employers often get wrong
- Assuming PAYE registration is bundled with incorporation — it is not. They are entirely separate systems and applications.
- Registering too early — HMRC expects PAYE registration close to (not months ahead of) your first actual payday; registering too early can itself cause processing delays.
- Underestimating the banking step — this is often the true bottleneck, not the PAYE application itself.
- Missing the RTI reporting cadence — payroll data must be submitted on or before payday, every time.
Disclaimer
This guide is general guidance, current at the time of publication, and is not a substitute for tailored legal, tax or accounting advice. Setupinuk works alongside specialist counsel and accountants on every engagement.