Contracting in Italy

[slice16]

Morning All,

I have been giving some serious consideration into going over to Europe to contract for a while. Mostly because I'm sick of the weather in the UK, and would just like another challenge.

An opportunity has arisen to work in the North of Italy, which I like the sound off. My only question is how it would work from a Tax/Legal perspective. I know I would need to get full advice on this, but would like a little bit of background so I know what questions I need to ask when I find an Italian Accountant.

The role would be 3 to 6 months, provided by a UK based company. Therefore, my UK LTD would have a contract with another UK LTD.

If this was short term, I imagine I could just keep everything as is with UK PAYE, dividends, Corp Tax etc? Longer term, I know I have to worry about where my LTD is managed etc. But short term is everything good?

Thanks

Paul

[DaveB]

Start with your current accountant, assuming you have one.

They should be able to give you the basiscs on working in Europe with a UK Ltd. at least. They may also be able to recommend a source of Italian specific advice.

[BlasterBates]

If the end client is a UK company, using your UK Ltd company should be no problem provided that you don't say longer than 6 months. In fact your invoice won't be audited by the Italian tax authorities anyway.

If the end client is an Italian company then probably you need to register in Italy and pay tax there. This would be picked up in an audit.

What counts is where the end client is located not the agency. Tax authorities look at the relationship between the Ltd and the end client.

[slice16]

Start with your current accountant, assuming you have one.

They should be able to give you the basiscs on working in Europe with a UK Ltd. at least. They may also be able to recommend a source of Italian specific advice.

Thanks Dave, I have dropped an email over to my accountant for advice aswell.

If the end client is a UK company, using your UK Ltd company should be no problem provided that you don't say longer than 6 months. In fact your invoice won't be audited by the Italian tax authorities anyway.

If the end client is an Italian company then probably you need to register in Italy and pay tax there. This would be picked up in an audit.

What counts is where the end client is located not the agency. Tax authorities look at the relationship between the Ltd and the end client.

Thanks BlasterBlates. That makes sense, but my confusion is who do I declare as my end client? My contract would be with a large IT Consultancy that is based in the UK. They would be taking me the services of my LTD as consultancy to fill a skills gap.

Their customer is an Italian Company.

So where would the trail start? Is it my responsibility to pay Italian tax, even though my customer is in the UK? If I worked as a permy for the UK Consultancy, they would pay my NIC etc in the UK?

Thanks

Paul

[BlasterBates]

Thanks Dave, I have dropped an email over to my accountant for advice aswell.



Thanks BlasterBlates. That makes sense, but my confusion is who do I declare as my end client? My contract would be with a large IT Consultancy that is based in the UK. They would be taking me the services of my LTD as consultancy to fill a skills gap.

Their customer is an Italian Company.

So where would the trail start? Is it my responsibility to pay Italian tax, even though my customer is in the UK? If I worked as a permy for the UK Consultancy, they would pay my NIC etc in the UK?

Thanks

Paul

If you are being costed to a UK based project then that would be UK tax. If the consultancy simply charge your hours i.e. they act as an agent that would be risky as there would be an invoice in the Italian company with your name on it charged out by the consultancy.

It's advisable to get advice from an Italian accountant if you're unsure. As with anything on tax, there are grey areas.

Lets say a company is delivering a computer system, if they need your help in installing the computer system in Italy and they're paid a fixed price on delivery, then that would be a UK based project.

If the Italian company asks for help on their project and the consultancy simply acts as an agent, charging commission then probably that would be Italian tax.