6. Payments to Students, Visiting Academics, and Volunteers

See also:

6.3 Academic visitors

(a) Scope and application

The treatment of payments to academic or other short-term visitors to the University depends upon the circumstances of the visit, its duration and the nature of any payments or provisions made.

An academic visitor is someone who meets the following conditions.

Definition of an academic visitor for tax and payment purposes:

 The individual:

  • Does not have a contract of employment with the University; and
  • Will be at Oxford for a limited (and defined) period of time; and
  • Is associated with another institution (usually this means as an employee); and
  • Will be returning to their own institution upon completion of their visit to Oxford.

 

For the rules on payments to External Examiners, see section 6.4.

(b) The nature of payments made

The nature of any payment made to a visiting academic is crucial in determining correct treatment for tax purposes:

  • reimbursement or provision of payments to cover expenses is generally allowable;
  • payment of additional fees, honoraria, stipends, etc. will usually be taxable and will require you to determine employment status of the payee.

If there is a contract of employment or a contract for the provision of services between the individual and the University then the visitor must be treated as though they are a member of University staff, with tax and National Insurance assessed on any payments made accordingly.

(c) Expenses payments supported by receipts

An academic visitor may be reimbursed the actual costs of travel, subsistence and other expenses incurred whilst visiting Oxford. These may be claimed using the Expenses Procedures and are subject to the same requirements to provide receipts in support of every claim.

(d) Subsistence allowances for visitors from overseas

Visitors from overseas can usually be paid a daily subsistence allowance (i.e. a round-sum payment without the need to produce receipts), but only where clearance is obtained from HMRC in advance. Where this is required departments should complete the Tax Clearance - short-term visiting academic (35kb) and return it to the Payroll Team at least 1 month in advance of the expected arrival of the visitor.

A ruling will be sought from HMRC on whether a daily allowance may be paid without deduction of tax or National Insurance. Once this is received a copy will be sent to the department.

Approved payments may be made using AP Payment Request Form (2,970kb) with a copy of the HMRC clearance attached to each request. Payment will be via Oracle Financials in the form of electronic funds transfer or a cheque.

HMRC clearance is given only for the specific circumstances and time period provided on the stencil. If circumstances change or the period of stay is extended then further approval must be sought by completing an additional stencil.

Without specific clearance from HMRC, any round-sum payments made to visiting academics will be treated as taxable and may be delayed or withheld.

Note: Payment of round-sum subsistence allowances is not available to visitors from elsewhere within the UK. Expenses may only be claimed where supported by receipts.

(e) Tax-free payments to visitors from overseas

Non-UK nationals visiting Oxford for less than 6 months may, depending upon their circumstances, be able to obtain tax-free status for income received in the UK or a refund of any tax paid.

If clearance is provided for the payment of round-sum subsistence allowances, as outlined above, then these are paid without deduction of tax or National Insurance.

If clearance is not provided, or payments are to be made in return for work or service, then it may still be possible to pay an individual without having to deduct tax or National Insurance. Alternatively, if tax is deducted, individuals may be able to obtain a refund when they leave the UK. The following HMRC forms are used in both instances:

  • Form P85 - completed when an individual who has lived and worked in the UK leaves the UK and may not be coming back or is going to do work abraod for a full tax year.

HMRC no long provide a standard form for overseas visitors to complete and obtain tax exemption on arrival in the UK. In cases where it is believed that tax should not be paid, therefore, (e.g. exemption is claimed under a double taxation agreement) then the individual concerned should advise their departmental administrator at the earliest opportunity.

Departmental Administrators should complete form Tax Clearance - longer-term (Double Taxation) (37kb) and forward it to the Payroll Manager. Clearance to pay salary without deduction of tax will be sought from HMRC, but may take up to a month to obtain. Payment of salary without deduction of National Insurance will depend upon which country the individual is arriving from.

HMRC provide further information on this area but, if you have any questions, please contact the Payroll Manager.