Paying overseas editors and VAs: what UK creators need to know

When you pay an overseas editor or virtual assistant who is genuinely self-employed and based outside the UK, you are simply buying in a service, much like paying any other supplier — the cost is a normal allowable business expense against your profit.

Because the individual is not your employee and is not working under UK employment law, you generally do not need to operate PAYE or deduct any UK tax or National Insurance from what you pay them. Their own tax affairs are their responsibility in their home country.

IR35 and the newer off-payroll working rules are aimed at UK-based individuals who supply services through their own limited company but work in a way that looks like employment. These rules rarely apply to a freelancer based entirely overseas, but if the working pattern looks like full-time, exclusive employment in all but name, it is worth a closer look.

VAT is the area most creators overlook. If you are not VAT registered, paying an overseas freelancer has no VAT implications for you at all — you simply pay the invoice and claim the cost.

If you are VAT registered, the "reverse charge" usually applies to services bought from outside the UK. In practice, this means you self-account for VAT on your own VAT return — declaring output VAT on the amount paid and, if you are fully taxable, reclaiming the same amount as input VAT, so the net effect is often nil.

Keep proper invoices from your overseas contractors, even if they are not required to charge VAT. A clear invoice showing the service provided, the amount, the date and the currency supports your expense claim and protects you if HMRC ever asks questions.

Exchange rate movements matter for your bookkeeping. Convert each payment to sterling at a reasonable rate at the time of payment — most accounting software does this automatically if you record the transaction in the original currency.

A written agreement, even a simple one, is good practice regardless of tax rules. It should cover the scope of work, payment terms and currency, who owns finished files and edits, confidentiality around unreleased content, and what happens if either side wants to end the arrangement.

Some payment platforms used to pay overseas freelancers (for example international transfer services) charge their own fees — these are also a deductible business expense, so keep records of them alongside the underlying freelancer payment.

If your overseas team grows significantly, it is worth reviewing whether you are creating a taxable presence for your business in another country, which is a different and more complex question than simply paying a freelancer’s invoice — this is worth professional advice if your team becomes substantial.

Source: Income Tax rates and allowances (gov.uk) · Self Assessment (gov.uk)