Expat and Offshore Company question. Expat and Offshore Company question.
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  1. #1

    Nervous Newbie


    Join Date
    Feb 2020
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    Post Expat and Offshore Company question.

    Hi,

    I am a British citizen and an IT Contractor/freelances working remotely (mostly from UK currently) for a Gibraltar based client via my limited company (will call it IT UK Ltd going forward). However, in April 2020 I am looking to move to India at least for a year and continue working from there (home) for the same client. I have checked on HMRC SRT, I will be a non UK tax resident from 2020, therefore, it does not make much sense for me to pay UK tax for my IT UK Ltd company. Hence, I am considering an offshore setup for that, let’s call it IT Offshore Ltd, and pay all it’s due taxes back there.

    However, I also have a real estate business in the UK, all (i.e. nothing on personal names) via another limited company (let’s call it Property UK Ltd) and I usually loan the profits of the IT UK Ltd to Property UK Ltd to buy it’s properties. Thus, I will really need the IT business money in the UK. Hence, I am considering to make IT Offshore Ltd as a subsidiary (child) of IT UK Ltd and remit all its post-tax profits back in the UK.

    Questions:

    1. Will I still have to pay UK taxes (even differential) on eSoft UK Ltd for any remittances from its child company or will I not need to because, its directors (me and wife) are both non UK tax residents, please?

    2. I will still be withdrawing a director’s salary plus dividends either from my Property UK Ltd company to my UK personal bank account (and remit them to India for living), am I right in assuming that this should not impact my tax residency status because I will be working mostly from India and will be a no-uk tax residence as per the HMRC SRT ?

    Thanks,

  2. #2

    Should post faster

    skysies's Avatar
    Join Date
    Dec 2012
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    Before you go into all those schemes, the first thing you should consider: if you starting working from your company in India, you will effectively become an exporter of services to Europe.

    I have known guys doing offshore work from an EU country to the UK, which made a lot of sense before Brexit as the systems were aligned.

    But I have never seen an Indian "contracting" from India to a company in the UK. They are always employed by offshore consultancies. If it was so easy, thousands of Indians would have been doing this. Why do you think you will be different?

  3. #3

    More fingers than teeth

    BlasterBates's Avatar
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    If you work in India you will be running a business in India and therefore subject to tax there.

    Your business is located wherever you are working, not where your client is.

    I would take advice from a UK accountant about any further tax implications in the UK or Gibralter, which I doubt. I would also take advice in India from an accountant there.
    I'm alright Jack

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