Not in any country for 183 days in a year - where can company be registered/tax paid?

[BlasterBates]

I see, thanks for clarifying. There's a lot of misleading/contradictory advice online.

So as far as you know, even if I was only in Italy for a few months, I'd either have to register a new company there, or go through an umbrella company? I couldn't use my UK limited company to work for UK clients for a period of time?

Hoping the Italian accountant I have contacted can guide me more on this!

Yes you can use your Ltd but you need to register it in Italy. If you mean that you will be working during the week in the UK then obviously it is taxed in the UK. You tax yourself where you physically do the work, I'm assuming you work from home. EU rules allow you to move your company from one tax jurisdiction to another.

I would let an Italian accountant handle your affairs and just follow his recommendation.

[newcontractor08]

I would let an Italian accountant handle your affairs and just follow his recommendation.

Yeah this was always my intention, was just looking for a bit of guidance so I knew what to expect/ask.

I'm waiting to hear back from one accountant but if anyone has any other recommendations of someone familiar with both Italian tax and U.K. Companies it would be greatfully received.

I'll be sure to post back with the advice I receive as I've not found it easy to work out what I should do and it might be useful to someone!

Thanks all for the advice.

[yasockie]

Everyone here seems to be playing it safe and giving you the politically correct advice, which is contact your accountant.
If your visit to Italy is temporary and not related to business, then, in my opinion, you should carry on doing your business in the UK, via UK Ltd.
People who fly to Italy for a 2 week holiday, don't register for tax there, even if check their work email from time to time.

There's separate regulations about residency, in some countries, if you stay for longer than 3 or 6 months, you need to apply for residency, but that unrelated to tax and you can avoid it, by flying in and out every now and then.

[BlasterBates]

Everyone here seems to be playing it safe and giving you the politically correct advice, which is contact your accountant.
If your visit to Italy is temporary and not related to business, then, in my opinion, you should carry on doing your business in the UK, via UK Ltd.
People who fly to Italy for a 2 week holiday, don't register for tax there, even if check their work email from time to time.

There's separate regulations about residency, in some countries, if you stay for longer than 3 or 6 months, you need to apply for residency, but that unrelated to tax and you can avoid it, by flying in and out every now and then.

It is advantageous to tax yourself in Italy for 3 months, for example, because you have a tax free allowance, you're also exempt from IR35. If you move around several countries you may indeed legally pay very little tax at all because in each country you can take advantage of the tax free allowance or very low tax rates. In one tax year I worked in Luxembourg for 3 months, nd paid hardly any tax.

[Fred Bloggs]

It is advantageous to tax yourself in Italy for 3 months, for example, because you have a tax free allowance, you're also exempt from IR35. If you move around several countries you may indeed legally pay very little tax at all because in each country you can take advantage of the tax free allowance or very low tax rates. In one tax year I worked in Luxembourg for 3 months, nd paid hardly any tax.

And there lies another complication, not all jurisdictions entitle a temporary resident to claim any tax free allowance (no idea about Italy). And some jurisdictions even charge temporary residents a higher % of tax too. As usual, it is a case of DYOR.

[newcontractor08]

It is advantageous to tax yourself in Italy for 3 months, for example, because you have a tax free allowance, you're also exempt from IR35. If you move around several countries you may indeed legally pay very little tax at all because in each country you can take advantage of the tax free allowance or very low tax rates. In one tax year I worked in Luxembourg for 3 months, nd paid hardly any tax.

That's a very interesting point! I'll definitely research that. Thank you

[Fred Bloggs]

That's a very interesting point! I'll definitely research that. Thank you

While you're at it, check on the tax treaties for the jurisdictions you are interested in, money tax free in one jurisdiction could very well still be taxable in another. For example in the UK, as a UK resident, you declare all your worldwide income, the tax paid on it and the tax treaty will decide if any tax is due or not.

[m0n1k3r]

Popular opinion is that using a UK MyCo Ltd elsewhere is a bad idea. I'm not sure how it would be if your uncle had a UK MyCo Ltd and seconded you to Italy as an employee? I really don't know TBH. My old BigCo PLC employer did that with me all the time right around the EU.

I have used UK Ltd's elsewhere without issues. It is just a matter of going through the appropriate registrations first, and get the required admin in order.

If your uncle have an UK Ltd, takes you on as an employee and seconds you to Italy for 183 days or less then no issues. Mind you, his Ltd doesn't have to pay you the full amount as a salary, only just a reasonable salary as per Italian standards. Your LtdCo can then invoice his Ltd for the balance (less his margin of course - I assume he won't take on the extra administration for free).

[m0n1k3r]

And there lies another complication, not all jurisdictions entitle a temporary resident to claim any tax free allowance (no idea about Italy). And some jurisdictions even charge temporary residents a higher % of tax too. As usual, it is a case of DYOR.

Some give you a choice. For example, somebody working in Sweden for ≤ 183 days can either apply for special income tax, pay a flat 20% income tax, not claim any deductions, not file a tax return and be done with it. Or they can pay tax as an ordinary citizen, make use of the personal allowance and claim deductions (including 30% of mortgage interest) but will have to file a tax return.

[mrv]

You are liable for tax in any country you earn money.

If you live in Italy and work for two months, then go to Bulgaria and work for three months, then you will be liable for tax in Italy for the money you earned there and in Bulgaria for the money you earned there. You will need a separate company for each country you work in. You don't need to be in Italy or Bulgaria for 183 days to be liable for tax.

The tax residency 183 days simply means it becomes your main tax residency and that you declare not only your income from the country in question but also income from other countries as well.

Think of the 183 day rule as when your tax liability is unrestricted, rather than when you have a tax liability. In Germany for example there is a box and if you have you been there less than 183 days you tick restricted tax liability and if you've been there longer than 183 days you tick unrestricted tax liability. The same rule applies in every other country.

This is very incorrect. The correct answer - check the double taxation treaty between your country (presumably UK) and the other country, it will have all the answers. Most common case - one has to pay taxes in the new country on the income earned in the new country if he qualifies as a tax resident of the new country. The easiest way to become one is to spend 183 days in any 12 months period or 270 days in any 36 months period in the new country. Beware - new year does not reset the counter, it is any 12 or 36 months period. Usually taxes are only paid on the income generated while residing in the new country, from clients in the new country, although there you might find some differences. There are exceptions for sportsmen, sailors, artists etc, but that probably will not apply to you.

Don't confuse tax residency with living residency (I might be using the wrong term). Tax residency is where you have to pay taxes based on your commercial activities, and your living residency is where you normally live, the center of your life and interests, the location of your (main) home etc. A person can have only 1 living residency, but multiple tax residencies. Some super rich people are maintaining a lifestyle where they attempt to avoid becoming tax resident in any country at all, having houses in a few countries, counting days they spend etc, pretty exausting but lucrative from tax perspective.