The Foreign Entertainers Unit (FEU) is a specialist division of HMRC that was set up to ensure that production companies correctly account to HMRC for tax due when non-UK artists/entertainers and sportspersons perform in the UK.
The HMRC website has a comprehensive guide to the taxation of foreign entertainers/ sportspersons and the rules are complex such that it is only possible to give an overview here.
The general principal is that where an overseas resident entertainer or sportsperson works in the UK then they are subject to UK taxation on these earnings and on their UK expenses (including benefits in kind). In such circumstances withholding tax must be taken from the performer at the prevailing basic rate of UK tax. The Production Accountant needs to fill out an FEU1 form which shows earnings/expenses and the tax deducted and the Artist should be given one part of this form. The second part should be sent to the FEU with the payment (or with details of the online payment made). The third part is kept for the company’s own records. You are not allowed to duplicate or copy these forms so take care when handling the originals.
Whenever you make a payment from which you have deducted withholding tax, you must complete a tax deduction certificate, form FEU 2.
The form is completed online and then printed. Once completed you should:
- send 1 copy with your FEU1 return to the Accounts Office Shipley at the address shown on the return
- keep 1 copy for your own records
- give 1 copy to the payee – the foreign entertainer or sports person
If the payee loses the original certificate and requests a duplicate, this must not be issued, tell them to contact the Foreign Entertainers Unit.
It should be noted that this relates to all foreign in-vision performers, so care should be taken when members of the production not originally anticipated to appear in front of camera do actually end up in front of the camera, eg Stunt Co-ordinators
Advance rulings can be sought from HMRC to agree a set percentage to withhold from the fee only, which then covers tax on expenses and benefits as well.
Social Security Position
If the individual is self employed there will be no Class 4 NIC liability.
