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Working remotely for a UK client from an EU country

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    #51
    Originally posted by jamesbrown View Post
    The NT code should apply once you’ve submitted your P85, I think. This would provide relief from PAYE taxes, but not NI. In short, you would avoid a deemed payment with a large chunk of tax removed, but some would be removed, and I’m not sure how easy it would be to get back. The ErNI, probably no chance, but I am not certain.
    So that means, if the client declares me inside IR35 and even if I receive the NT code, I will be anyway forced to operate under PAYE? There is no way I can pay myself dividends?

    It's another question whether I will be able to get back some of the taxes paid under PAYE. For that, the discussion so far has been quite useful.

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      #52
      Originally posted by skysies View Post
      So that means, if the client declares me inside IR35 and even if I receive the NT code, I will be anyway forced to operate under PAYE? There is no way I can pay myself dividends?

      It's another question whether I will be able to get back some of the taxes paid under PAYE. For that, the discussion so far has been quite useful.
      Sure, you can pay dividends or salary. A deemed payment has the relevant UK taxes removed and is paid to your company. You don't receive the deemed payment, your company does. Once your company receives the deemed payment, it is free to pay it to you personally, but there will be tax implications where the work is done (outside the UK), of course. Your company will not be free to receive a B2B payment, instead of a deemed payment, and then to make a dividend payment from the profits associated with that to you personally, but that is hopefully obvious. What you really want is a normal B2B payment, as we've been discussing, but you say that is highly unlikely, so then you're stuck with a deemed payment.

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        #53
        Originally posted by jamesbrown View Post
        What you really want is a normal B2B payment, as we've been discussing, but you say that is highly unlikely, so then you're stuck with a deemed payment.
        No, I don't think my company will treat me in any special way. I'm sure they will make a blanket decision and they will declare all of the contractors inside IR35. I'm just very realistic what will happen next year.

        So I think I will be receiving deemed payments and hopefully be granted the NT code. Regarding the NI, I asked previously if I can use A1, to pay the national insurance in the new country. I mean, if I have a history of paying the insurance there (I think it's min 6 months) why should this not be possible?

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          #54
          Originally posted by skysies View Post
          No, I don't think my company will treat me in any special way. I'm sure they will make a blanket decision and they will declare all of the contractors inside IR35. I'm just very realistic what will happen next year.

          So I think I will be receiving deemed payments and hopefully be granted the NT code. Regarding the NI, I asked previously if I can use A1, to pay the national insurance in the new country. I mean, if I have a history of paying the insurance there (I think it's min 6 months) why should this not be possible?
          Your EeNI payments in the UK may be counted towards social security in your country of residence if there's a reciprocal social security agreement, but you would need to speak to a specialist about that. You're not a posted worker, though. Your company is not sending you overseas. You are moving overseas indefinitely and still working for a UK client who is merely your deemed employer, not your actual employer. The deemed payment issue is a peculiarity of UK legislation. Normally, you'd be paying social security where you work. So I don't believe an A1 would apply, but you'd need specialist advice on this (in case it isn't obvious, I am speculating).

          If you want more details on the cross-border aspects, try Sue@IPaye, for example (but that will be paid advice).

          Comment


            #55
            Originally posted by Fred Bloggs View Post
            Unless I am missing something, the OP cannot be granted that until he has been out of the UK for a full tax year after the tax year in which he leaves. You do not get non-UK tax status the day you leave.
            If you leave the country with the intention to be out for over a full tax year, you do get non-UK tax status from the day you leave. It's covered in my earlier post.

            Originally posted by NotAllThere View Post
            Yes, but rather this Tax on foreign income: UK residence and tax - GOV.UK "Split Year Treatment".
            If you take advantage of split year treatment then return before completing a full tax year, you'll have revert to the status you should have had and probably have a bill to pay - less tax already paid if a dual taxation agreement is in place..
            Down with racism. Long live miscegenation!

            Comment


              #56
              Originally posted by NotAllThere View Post
              If you leave the country with the intention to be out for over a full tax year, you do get non-UK tax status from the day you leave. It's covered in my earlier post.



              If you take advantage of split year treatment then return before completing a full tax year, you'll have revert to the status you should have had and probably have a bill to pay - less tax already paid if a dual taxation agreement is in place..
              1 Yes, I know and I agree that is the case. But because HMRC guidance is not to file a P85 if you do SATRs (and we all do) then that tax status is only confirmed in arrears never in real time if you follow the HMRC guidance on not filing P85. This is done by SATR when you claim your split year treatment for year of departure.

              2 You will indeed, so it is extremly important to get your ducks lined up well in advance to avoid any bad surprises when you arrive home in UK permanently. Applies to me very soon, I have been planning my return and finances carefully for the last year or more for that event. Split year treatment for year of return application will be made on 20-21 SATR by me.
              Public Service Posting by the BBC - Bloggs Bulls**t Corp.
              Officially CUK certified - Thick as f**k.

              Comment


                #57
                Originally posted by skysies View Post
                No, I don't think my company will treat me in any special way. I'm sure they will make a blanket decision and they will declare all of the contractors inside IR35. I'm just very realistic what will happen next year.

                So I think I will be receiving deemed payments and hopefully be granted the NT code. Regarding the NI, I asked previously if I can use A1, to pay the national insurance in the new country. I mean, if I have a history of paying the insurance there (I think it's min 6 months) why should this not be possible?
                Since you've deregistered using a P85 then you'll be paying no tax as you will be registered in a different country. You won't be working in the UK so there is no reason to fill out an A1 form.

                If the agency will be sending your details to HMRC how would they know you are not working in the UK?

                I can see you may be facing some rather time consuming enquiries due to a fundamental misunderstanding that they will assume you are working in the UK. If so this will probably not simply be clarified by a letter. You're going to have to provide proof. The problem here is not IR35, it is the potential wrangle caused by being incorrectly registered as a "worker"/"employee" for a UK client by the agency.

                I would advise using an Accountant to ensure the agency's procedures accurately reflect your status working remotely.
                I'm alright Jack

                Comment


                  #58
                  Originally posted by BlasterBates View Post
                  Since you've deregistered using a P85 then you'll be paying no tax as you will be registered in a different country. You won't be working in the UK so there is no reason to fill out an A1 form.

                  If the agency will be sending your details to HMRC how would they know you are not working in the UK?

                  I can see you may be facing some rather time consuming enquiries due to a fundamental misunderstanding that they will assume you are working in the UK. If so this will probably not simply be clarified by a letter. You're going to have to provide proof. The problem here is not IR35, it is the potential wrangle caused by being incorrectly registered as a "worker"/"employee" for a UK client by the agency.

                  I would advise using an Accountant to ensure the agency's procedures accurately reflect your status working remotely.
                  In the brave new world where everyone's an employee, this could be a problem not so easily sorted. I seriously doubt circumstances like this fit within the PAYE sausage machine models soon to be applied across the board.
                  Public Service Posting by the BBC - Bloggs Bulls**t Corp.
                  Officially CUK certified - Thick as f**k.

                  Comment


                    #59
                    Originally posted by Fred Bloggs View Post
                    In the brave new world where everyone's an employee, this could be a problem not so easily sorted. I seriously doubt circumstances like this fit within the PAYE sausage machine models soon to be applied across the board.
                    Indeed, I think there is a big hole somewhere, which is why I think an accountant is required.
                    I'm alright Jack

                    Comment


                      #60
                      Originally posted by BlasterBates View Post
                      Indeed, I think there is a big hole somewhere, which is why I think an accountant is required.
                      To be honest, I fear it may be beyond fixing. Given the industry's track record of creatively exploiting any real or fabricated circumstance in order to gain tax advantages though "QC approved" schemes, it'll be a battle to win. I'm sure of it. I could be wrong, but I can't see the OP getting what he wants here.
                      Public Service Posting by the BBC - Bloggs Bulls**t Corp.
                      Officially CUK certified - Thick as f**k.

                      Comment

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