Contractors' Questions: Can I retain client in Italy but supply from UK?

Contractor’s Question: I live in Italy and work as a freelance contractor, receiving my pay here in Euros into my Italian bank account. Next month, I’m moving with my family to the UK where I’ll start being a sole trader, and still supply my Italian client albeit from a UK address.

Can I continue to be paid into my Italian bank account in Euros while living in UK? I want to keep the Euros account in Italy or do I have to open a Euro account in UK? Also, as regards invoices, they will probably be without VAT; that's correct, isn't it?

Expert’s Answer: From when you start operating as self-employed in the UK, you can elect to be paid by your Italian client in your own personal bank account in any country and in any currency you choose.

You do not have to open a Euro account in the UK. Your Italian bank can convert Euros into sterling which you can transfer to your UK bank account; or you can use a foreign exchange company which will likely to give you a superior conversion rate.

As regards VAT, the threshold in the UK is currently £83,000. Until you want to register fot VAT register for VAT (there are some benefits) or until you need to register for VAT (the threshold above which you must register is currently £83,000), your invoices cannot include VAT.

The expert was Mike Philips of overseas contracting and compliance advisory its international.

Editor’s Note: Related Reading –

Contractors’ Questions: How to keep my UK clients but live in Italy?

Contractors’ Questions: Do I add VAT to my overseas invoice?

Contractors’ Questions: How to know if euros or pounds are preferable?

 

Thursday 21st July 2016