NI Contributions

**ASB** · 2 September 2007, 09:12

Originally posted by daisenthal View Post

I am a non-resident UK citizen (I have lived out of the country for over 10 years) and I am now employed as an IT contractor for a UK company. The work itself is in the Netherlands.
I pay all my tax and social security contibutions in the country I now reside.
Although the UK company is happy to pay me without income tax taken off, they claim that NI contributions of 12.8% need to be paid?
Is that correct? Considering that I live abroad and do not work in the UK and pay all my own NI contributions elsewhere, I find this strange.
Can anyone help?

you say "I am now employed as an IT contractor for a UK company" is that what you really mean?

If you are actually an employee then the employers NI to which you refer is not your issue - although of course they may want to factor it in to whatever salary is paid. It is possible that it may be payable, or it might not be depending upon the circumstances. Some guidance here: http://www.hmrc.gov.uk/pdfs/nico/ni132/ni132-01.htm

If you are a supplier then it will all be very different. However largely he TAX and NI issues are your responsibility. In any event they may be an interaction with IR35 or the MSC legislation dependant upon your specific circumstances and arrangements.

Also of course you have to ensure you are doing the correct thing with regard to the dutch authorities.

**Burrow01** · 2 September 2007, 14:26

Hi - It depends how your contract is constructed - are you working directly for a UK company, getting paid in ££'s but tax resident in Holland, is there a Dutch company acting as an intermediary?

**NotAllThere** · 3 September 2007, 09:21

A UK employer, employing a non-UK resident employee to carry out work outside the UK, should NOT be paying ERNIC.

Is the UK employer in this case a brolly? Or what?

NotAllThere

**ASB** · 3 September 2007, 09:48

Originally posted by NotAllThere View Post

A UK employer, employing a non-UK resident employee to carry out work outside the UK, should NOT be paying ERNIC.

As usual it is not that simple. Generally that is true (and probably is in this case) but there are cases when it isn't.

**NotAllThere** · 3 September 2007, 09:52

I'm curious - assuming that the worker really is not resident, what are those cases?

NotAllThere

**ASB** · 3 September 2007, 10:24

Originally posted by NotAllThere View Post

I'm curious - assuming that the worker really is not resident, what are those cases?

NotAllThere

- The place the employee is working is not covered by EC regs (or reciprocal arrangements), ordinarliy resident in the UK, was resident in the UK before starting working abroad.

The liability is, I believe for up to one year. Start here:- http://www.hmrc.gov.uk/nic/work/abroad-index.htm

I do not expect this applies to the OP, but it could apply to some.

In the case of a non-resident employee they are unlikely to be caught but potentially could be if ordinarily resident (which you could theoretically be is long terms non resident) and had a period of actual residency shortly before.

Dreaming up possible scenario: non resident. Work abroad, maintain family property. Return to UK for a few months.. Find job, posted overseas.

**daisenthal** · 3 September 2007, 13:25

Clarification of my working status

I currently live in Israel (pay income tax and SS contributions) , work in the Netherlands but have a consulting services agreement thru a UK company. I am not an employee of the UK company.
From what I understand from the responses so far, I should not be paying NI contributions in the UK. Is that correct?

**PAG** · 3 September 2007, 15:13

Originally posted by daisenthal View Post

I currently live in Israel (pay income tax and SS contributions) , work in the Netherlands but have a consulting services agreement thru a UK company. I am not an employee of the UK company.
From what I understand from the responses so far, I should not be paying NI contributions in the UK. Is that correct?

If you are not employee of UK company then what are the terms of the contract with UK ??
Do you invoice them and they in turn invoice client in Neterlands ??

If B2B then there is no issue of NI.

**ASB** · 3 September 2007, 16:03

Originally posted by daisenthal View Post

I currently live in Israel (pay income tax and SS contributions) , work in the Netherlands but have a consulting services agreement thru a UK company. I am not an employee of the UK company.
From what I understand from the responses so far, I should not be paying NI contributions in the UK. Is that correct?

Is the UK company an agency. There are special rules for agency supplied staff even if they are placed abroad.

However, from your description I do not see how you have any liability to UK contributions, or how an employer does on your behalf.

The relevant HMRC helpline should be on the end of this number: 44 191 225 4811

NI Contributions