Step 1: Determine if withholding is required
Payments to non-resident entertainers and sportspersons are subject to withholding tax if the income exceeds the Personal Allowance. For the 2025/26 tax year, the Personal Allowance is £12,570. If the payment is below this amount, no tax needs to be withheld, but you must still notify HMRC.
Step 2: Calculate the tax amount
Tax is withheld at the basic rate of 20% on the amount exceeding the allowance. For example, if the fee is £20,000, tax is withheld on £7,430 (20,000 − 12,570) = £1,486.
Step 3: Withhold the tax and pay HMRC
You must withhold the tax before paying the artist and remit it to HMRC. This can be done via the PAYE system or using a special form for foreign entertainers. The payment deadline is no later than 14 days after the end of the tax quarter in which the payment was made.
Step 4: Submit reporting
You must file a report with HMRC using the form "Entertainers and sportspersons: reporting payments" (available online). Include the payment date, amount, tax withheld, and recipient details. Reports are submitted quarterly.
Step 5: Provide documents to the artist
After paying the tax, issue the artist a certificate of tax withheld (e.g., form P60 or equivalent). This allows them to claim the tax in their home country (if a double taxation agreement exists).
FAQ
Do I need to withhold tax if the artist performs in the UK for less than 30 days?
Yes, the rule applies regardless of the length of stay if the payment exceeds the Personal Allowance.
What if I mistakenly failed to withhold tax?
You should notify HMRC as soon as possible and pay the tax with penalties. It is advisable to consult a tax advisor.
Does this apply to online performances?
Yes, if the services are physically performed in the UK. For virtual performances, rules may differ — check with HMRC.
VirtCardPay's Take
Paying foreign artists and athletes requires attention to tax obligations. Use VirtCardPay virtual cards for fast and secure international payments, but don't forget to consult an accountant for tax matters.
Disclaimer: This article is for informational purposes only and does not constitute tax advice. For accurate obligations, seek professional tax advice.
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