Commentary on Sections The Income Tax (Offices and Employments) Act 1944 (7&8 Geo. 6. (1943-44) c.12) Machinery of PAYE Section 690: Employee non-resident etc.
2787.This section makes special provisions for PAYE for employees who are both non-resident (or not ordinarily resident) and working partly in the United Kingdom and partly not. It derives from section 203D of ICTA.
2788.An employee in these circumstances may be chargeable to income tax on only some of the employment income. Payments which were partly of PAYE income and partly not would not be subject to deductions. This section provides that payments (or a proportion of payments) are subject to PAYE.
2789.Subsection (2) provides for a direction to be made, on application by the “appropriate person” (see subsection (3)) to the Inland Revenue. The direction states what proportion of income from that employment is to be subject to PAYE deductions. It contains two minor changes:
	directions under this section affect only PAYE income paid by or on behalf of the employer. This change is then followed through in subsections (3)(b), (7) and (8). See Change 148 in Annex 1.
	it allows a direction to be made where the income which is not assessable is  ascertainable. See Change 149 in Annex 1.
2790.Subsection (7) ensures that when a payment to which a direction under subsection (2) applies is made to the employee, PAYE deductions are made from the proportion of the payment specified in the direction. This is achieved by deeming the proportion to be PAYE income.
2791.Subsection (8) sets out the position if no direction is made. Then all the payment is subject to PAYE.
2792.Subsection (9) makes sure that this section does not affect the employee’s tax liability.
2793.Subsection (10) is new. It deals with how this section is modified if both it and section 689 apply to the same employment. This could happen if the employer (or an intermediary of the employer) is outside the UK tax net. Section 689 might then lead a person in the United Kingdom for whom the employee is working to have to operate PAYE. See Change 149 in Annex 1.