• Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
  • Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!

What happens if you live in one country but work in another?

Collapse
X
  •  
  • Filter
  • Time
  • Show
Clear All
new posts

    What happens if you live in one country but work in another?

    Do you pay tax where you live or where your contract is? I suspect that the rules may be different if both countries are within the EEC

    #2
    Re: What happens if you live in one country but work in anot

    The general rule is that you pay tax in the country where the work is performed first and then in any other country that you have tax residency second (taking account of double taxation rules to avoid you paying tax twice).

    Obviously, there are rules in place for some specific circumstances to avoid you have to declare small amounts of income in lots of different countries.

    What is it you had in mind? Daily commute, weekly commute, single short trip ...?

    tim

    Comment


      #3
      Re: What happens if you live in one country but work in anot

      I am thinking of retiring somewhere in the sun. If it was somewhere withing the EEC with lower taxation than the UK, I was wondering if I may be better buying early and migrating there. If you get taxed in the country where you work though, it's probably not viable

      Comment


        #4
        Re: What happens if you live in one country but work in anot

        Ignoring the tax side of things I think that you will find that for most countries you have missed the "getting in early bit". Almost all of Europe has seen mega price rises in the last 3 years and there are few places that you might reasonably want to live where you will find a bargain. Romania perhaps!

        Wait for the crash :-(

        tim

        Comment


          #5
          Re: What happens if you live in one country but work in anot

          I appreciate that yes. I'm waiting for the timebomb to explode so thta I can pick up a nice cheap holiday home and 4x4!

          Comment


            #6
            Re: What happens if you live in one country but work in ano

            It all gets very complicated..the sooner tax and socail securtiry is harmonised in the EU the better.

            I am living in France for three weeks a month, but do contract
            work for a company in Ireland, where I live for the other week.
            I was doing the same from the UK, where I am still paying tax.

            Do I therefore have the choice of paying tax in Ireland or France? And would I only be eligible for French social security if the tax was paid in France?

            Comment


              #7
              Re: Re: What happens if you live in one country but work in

              OK, same answer, more detail.

              In general, you have no choice where you pay tax (assuming that is, you actually want to be 100% legit). You pay it based on whatever it says in the laws of the country you are physically in when you do the work. This will normally say that you give them the money, but it might be that if you are normally tax resident elswhere that you are allowed to pay it there instead.

              Social Security is another issue completely. You do get some choice as to where you pay it, and it is possible to be able to claim French social payments based upon contributions made in another country. But you need to have the right forms. You don't just make it up as you go along.

              tim

              Comment


                #8
                French Social Security

                You don't want to pay that. And you probably don't need to. There is an arrangment available where you can continue paying UK NI if you are still UK resident (for tax purposes).

                Under French law you *should* be paying French taxes on you worldwide income (these may well be lower than the UK equivalent if you are married with a couyple of kids).

                You should also be paying French SS unless you have elected to continue paying UK (search HMRC wesite).

                You are also *probably* still resident in the UK for tax purposes. As such you are also liable for UK taxes on your worldwide income (unless you are not UK domiciled). However you should, under the terms of the agreement between France and UK get 100% relief on you French tax (to the limit of the UK TAX that was due).

                As for Ireland (I assume you are talking about Eire) I don't think you become resident as a result of the limited time you sped there, but it is possible you do.

                It may well be worth you while seeking some proper advice.

                When I was (sort of) resident in France my UK company invoiced my French clients. They paid these bills in full i.e. there was no withholding tax. I simply carried on - not registering with the French authorities etc. They did get a little excited (but not very) when I had to have a chat with the local examining magistrate after an RTA though.

                I don't think Eire has any withholding taxes - but if they do this can be an issue. The double taxation treaties only generally claim against like for like.

                e.g. My invoices to Potuguese clients are currenlty subjected to a 15% withholding tax. This is claimable against MyCos UK CT bill -but not against say my perosnal income tax bill.

                Comment


                  #9
                  Thanks

                  Thanks for your both your comments - sorry I have just realised I hijacked this thread!

                  My situation is very ad hoc, working at home in one country, for a company in another, being a national of another, so I will be talking to the French and British tax offices for their opinions.

                  As was said social security is a different matter, although who you pay in France seems to be linked with how / where you work. Lots of reading to do I guess..

                  Comment


                    #10
                    Re: Thanks

                    You didn't really hijack the thread. It was all interesting stuff and probably relevant to the topic....and it kept bumping it too!

                    Comment

                    Working...
                    X