Hi - just wondering if someone has come across this in practise. It's a French government intern-ship system whereby graduates are seconded overseas to subsidiaries of French multinational companies. The intern has no contractual link with either the French company or the subsidiary where they are seconded to - the arrangement is between the intern and a French government agency. The French government agency pays the intern an allowance in France and this is re-charged to the French company (there is no recharge to the subsidiary of the French company where the intern is "working").
I have the situation of one such graduate doing an internship for a UK subsidiary for a period of 12 months and just want to be 100% sure on the PAYE and NI implications of the allowance that he receives in France. It appears that PAYE and NI don't apply however I am not entirely sure on what basis - perhaps the government service or student (business apprentice) clauses of the treaty? Has anyone dealt with this before and can they clarify?
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This is the same point you asked yesterday
You say there is no contractual link, which means there is no employment. No employment means no employer obligations. Are you really sure you should be taking on this work?
Ask the Embassy
Google translate says:
The administrative and legal management of VIE is delegated to France Business that deals for you the contractual aspects, the payment of compensation and social protection of the volunteer.VIE formula exempts your company from any direct contractual relationship (the contract is signed between France and the Business young volunteer). Enjoying a public status, the volunteer is under the administrative supervision of the Economic Mission of the Embassy of France in their country of assignment. You pilot course in direct operational activity
so if you ask the business desk of the french embassy, they may be able to reassure about how this works wrt NMW, tax residency, etc
Si vous preferez...
La gestion administrative et juridique du V.I.E est déléguée à Business France qui s’occupe pour vous des aspects contractuels, du versement des indemnités et de la protection sociale du volontaire. La formule V.I.E exonère votre entreprise de tout lien contractuel direct (le contrat est passé entre Business France et le jeune volontaire). Bénéficiant d’un statut public, le volontaire est placé sous la tutelle administrative de la Mission Economique, près l’Ambassade de France dans son pays d’affectation. Vous pilotez bien sûr en direct son activité opérationnelle.
http://export.businessfrance.fr/formule-vie/vie-en-bref.html
Thank you!
Whilst I appreciate the beautiful language of the French, the point I was trying to make was that in the past, in my experience, google translate has proved somewhat unreliable.
Perhaps the client in question would be better served by a French tax advisor, to avoid such mistranslations and the headache that ensues?