I recently decided to quit my nine to five and take on a contract position in Brussels through a Belgian agency, having spent the last 2 weeks looking into the issues such as should I go with an umbrella or become a limited company and what tax am I likely to be paying and to who and what's this LIMOSA rubbish the initial excitement has worn off and I'm left thinking "is it worth it?"
So I thought i would put together what I have so far and put it to the ContractorUK test and see if I can regain some of that lost excitement, here are my findings If someone can support or debunk them with some real life experience or expert knowledge then please do.
I will stress at this point that despite the advice of most of the accountants I have spoken too I have no interest in avoiding tax though if there are any risk free and more importantly LEGAL ways of making my tax more "efficient" then I would be greatful to hear about them.
so here goes.....
-My contract is worth about £60K/79.5K Euros a year and I will fall foul of IR35
-I can either use a UK umbrella company for 183 working days, set up a UK limited company or become Belgium self employed (any thoughts on that?)
-Due to IR35 I cant split my income into Salary and dividends through a limited company
-By doing some basic calculations under UK Tax I will take home about £44K and under the Belgian system about £34k (assuming 0 expense entitlement)
-I have 183 working days in belgium before I will officially be liable to start paying their taxes
-I can continue to pay UK national insurance so I won't need to pay Belgian social security payments
-I need to register with LIMOSA (still need to read more on this one)
-If i have a uk limited company then as the seat of control is in Belgium it will be considered to be based in Belgium (still not sure of the implications of this)
-Any payments from Euros to Pounds or back will incur an exchange fee so need to build that in somewhere.
That's about all I can think of right now I feel better already for just writing it down! if you can expand on this then that's great.
cheers and thanks for reading this far
So I thought i would put together what I have so far and put it to the ContractorUK test and see if I can regain some of that lost excitement, here are my findings If someone can support or debunk them with some real life experience or expert knowledge then please do.
I will stress at this point that despite the advice of most of the accountants I have spoken too I have no interest in avoiding tax though if there are any risk free and more importantly LEGAL ways of making my tax more "efficient" then I would be greatful to hear about them.
so here goes.....
-My contract is worth about £60K/79.5K Euros a year and I will fall foul of IR35
-I can either use a UK umbrella company for 183 working days, set up a UK limited company or become Belgium self employed (any thoughts on that?)
-Due to IR35 I cant split my income into Salary and dividends through a limited company
-By doing some basic calculations under UK Tax I will take home about £44K and under the Belgian system about £34k (assuming 0 expense entitlement)
-I have 183 working days in belgium before I will officially be liable to start paying their taxes
-I can continue to pay UK national insurance so I won't need to pay Belgian social security payments
-I need to register with LIMOSA (still need to read more on this one)
-If i have a uk limited company then as the seat of control is in Belgium it will be considered to be based in Belgium (still not sure of the implications of this)
-Any payments from Euros to Pounds or back will incur an exchange fee so need to build that in somewhere.
That's about all I can think of right now I feel better already for just writing it down! if you can expand on this then that's great.
cheers and thanks for reading this far
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