Contracting in the UK from Ireland

**NotAllThere** · 27 August 2008, 08:07

I'd go option 2. It's relatively easy to ensure that the uk company makes no profit, so no tax due in the UK.

What I don't understand is how you can open a UK company if you're not a UK resident.

btw - some agencies have no problem with an offshore company, if you are resident offshore.

**pmeswani** · 27 August 2008, 08:39

Originally posted by NotAllThere View Post

I'd go option 2. It's relatively easy to ensure that the uk company makes no profit, so no tax due in the UK.

What I don't understand is how you can open a UK company if you're not a UK resident.

btw - some agencies have no problem with an offshore company, if you are resident offshore.

Some may use their accountants as the registered address to get around this problem. Not sure how legal this is.

**ASB** · 27 August 2008, 09:53

Originally posted by taddie View Post

Hi All,

I live in Ireland and have been contracting here for a couple of years through my own limited company registered in Ireland. The next contract is likely to be in the UK and I will be commuting weekly from Ireland to the UK. I thought of using my Irish company to invoice the agency, but they are insisting that they do not deal with the companies registered outside of the UK.

To workaround this issue, I can think of two options:

Register a UK branch of my Irish company following the guidelines from the Companies House. Based on the referenced description it seems to be a relatively easy and not very expensive way. However I am not sure if there will be any filing obligations with HMRC? or will I have to collect and pay VAT in the UK? Any advise on what I could read on the subject is very much appreciated.
Open a UK limited company and sub-contract the work to the Irish one, so the agency would be satisfied and I would still have the money in the Irish company and will be able to pay myself salary in Ireland + travel expenses + per-diem while in the UK. Are there any issues with this setup? Again, any comments, thoughts or pointers to articles/relevant information are appreciated.

Cheers,
tadd.ie

You need to consider whether you are UK resident. You may well become so. You can, of course be resident in both the UK and ireland simultaneously.

If you do become UK resident HMRC could also consider the irish company to be tax resident.

The residency rules have been tightended recently and it is much more difficult to do a weekly commute and not be resident.

I wuld suggest it is worthwhile seeking advice in both UK and Ireland to ascertain your position.

**ft101** · 27 August 2008, 10:55

Also get everything in writing, check everything and trust nobody.

Not *directly* related to OP's question but a similar situation.

Suffice to say resulting from bad advice from both an Irish based accountant and the Irish Revenue (who are normally pretty good) and ended up getting stung by HMRC (who would not work directly with IR either). Irish Revenue were perfectly happy to take tax that was not owing - over a number of years too - and that should have gone to HMRC. The irish accountant was doing the returns and should have advised us - his later defence was that he did not know about 'international' tax law and we should have used someone who did (!). On multiple occasions we had queried the matter with both the accountant and Irish Revenue who both gave incorrect advice and even at one point denied receiving the tax. Am still sorting this out with HMRC.

I can't go into any further details for privacy reasons.

Lesson - trust nobody, cross reference everything between HMRC and IR and get everything in writing!

**BlasterBates** · 27 August 2008, 13:33

Originally posted by NotAllThere View Post

I'd go option 2. It's relatively easy to ensure that the uk company makes no profit, so no tax due in the UK.

What I don't understand is how you can open a UK company if you're not a UK resident.

btw - some agencies have no problem with an offshore company, if you are resident offshore.

You can only pay yourself an Irish salary for 183 days then you will have to pay your salary in the UK.

Contractors constantly get stung here. You can't just pay yourself in any country, otherwise we'd all be payed in the Cayman Islands.

and if the the IR did catch up with you I doubt whether the Irish tax authorities would reimburse you. If you pay too much tax due to stupidity they'll claim it was your fault, suspect. I once paid too much tax in Germany and just got a nasty legal letter declaring my stiupid incompetence.

**expat** · 27 August 2008, 13:37

Originally posted by NotAllThere View Post

I'd go option 2. It's relatively easy to ensure that the uk company makes no profit, so no tax due in the UK.

What I don't understand is how you can open a UK company if you're not a UK resident.

What's the problem? Yes, the company needs an address in England&Wales, or Scotland, but you don't need to be resident. Who is "you", paleface? The Director? Nowhere does it say that a director has to be resident, or even human.

**BlasterBates** · 27 August 2008, 13:47

Due to EU rules you can either register your Irish company in the UK, or start a Ltd. In either case once you have registered in the UK, the authorities will be expecting you to have your salary paid in the UK. They would take a very dim view of an Irish salary for work carried out in the UK. Though it is feasible to pay part of your salary in Ireland provided you can prove you work there part of the time.

If your client would pay your Irish company directly, which they could for a limited period, then you could be paid an Irish salary.

**taddie** · 27 August 2008, 14:05

Thank you everyone for the feedback and opinions, much appreciated.

The initial contract is going to be from October until the end of the year, so considering that I will only be spending Mon-Fri in the UK, I won't spend 183 days before April'09 in the UK even if the contract is extended.

In fact if it turns into a long term affair, i.e. the contract is extended into the next year, I will move to the UK together with my family and will open a UK limited company, pay myself salary and the taxes due in the UK, etc. Until such time I am an Irish resident going weekly on business to the UK.

Can someone suggest where I could get advice on opening of a UK branch of my Irish company and associated filing and tax liabilities, etc.?

Regarding opening a UK limited company before actually moving to the UK -- I am not sure what the legal position is to be honest. If one does not have to be a UK resident as expat is suggesting, than getting a UK address is not a problem - there are lots of Mail Drop / Virtual Office companies out there.

**greg_canada** · 29 August 2008, 11:37

Have a similar situation - live and contract ex-EU, using a ltd. co. registered in the same country AND contract in UK / RoI using separate ltd. co. in the UK. BTW: Never have had any problems using a UK ltd in the RoI.

There MAY be advantages / disadvantages to having one co. as a shareholder of the other.

UK co was set up by incorporationservices.co.uk - based in Newcastle. They also act as co seccy, to receive ( and forward ) mail.
Not a cheap mailing service, but at least it works!

CHECK your plans with a good chartered accountant / tax accountant coy.

One thing - you'll have to account for exchange losses .... the money never seems to be in the right account. They are substantial - about a 4% loss every time. Adds up quickly, especially when you have to resort to ATMs.

Contracting in the UK from Ireland