When you arrive to work in the UK there are two important tax related tasks you need to attend to as soon as possible:
1. complete an Inland Revenue form P86
2. apply for a National Insurance (NI) number.

Why?
The UK tax authority (the Inland Revenue) aims to deduct the right amount of tax from your pay before you receive it using a mechanism called PAYE (pay as you earn). This is designed to avoid you paying too much tax or alternatively being landed with a large tax bill at the end of the tax year. However, the PAYE system will only work correctly if the Inland Revenue has the right information about you, and the form P86 is the way to collect it.

The PAYE system uses a tax code number to spread your tax liability equally over the tax year, but to issue the right code the Inland Revenue must know how long you plan to stay in the UK. If the Inland Revenue has no information about you it will instruct your employer to use an emergency PAYE tax code number. This will potentially result in more tax being paid than necessary as it will not take account of any tax-free personal allowance or valid expenses you have incurred in connection with your UK employment.

There is a very limited range of expenses you can ask the Inland Revenue to take account of before tax is deducted. These include Medical College subscriptions but do not extend to the rent of the accommodation you use while working here.

The UK also operates a social security contribution system called National Insurance (NI), which is partly run by the Inland Revenue but not completely integrated with the tax system. It is important to get your own unique NI number as this is used as a reference number in all computerised payroll systems and within the Inland Revenue to identify your contribution records.

To obtain an NI number check the phone book for the nearest Social Security or Jobcentre Plus office and make an appointment for an evidence of identity interview. You will be asked to complete a form CF 8 and provide your contract of employment, or a letter from the hospital trust that employs you. You should also take along your passport, your birth certificate if you have it, and if you are not a EU citizen, any UK Government Home Office department documents that confirm your right to work in the UK. The interviewer will want to see the original documents not photocopies.

When the application is complete you should be sent a form CF 5404 which you can show to your employer to prove you have applied for an NI number. If you have already been paid before your NI number is issued your employer may use a temporary NI number on your pay records that uses your date of birth and starts with the letters TN. This should be replaced with your unique NI number as soon as possible and certainly by the end of the tax year on the next 5th April.

It is important that the your unique NI number is used on your payslips and on the end of year tax forms so the NI contributions deducted from your pay are correctly allocated against your NI contribution record. When you leave the UK you may be able to ask for these contributions to be transferred to your home country’s social security system.

If you normally live in another European country and hold a certificate that proves you are continuing to contribute to the social security system in your home country you do not have to pay NI charges in the UK, while that certificate is in force. If you come to the UK from a country outside Europe you will have to make NI contributions in the UK.