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Is my contract compliant with the 183-day rule?

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    Is my contract compliant with the 183-day rule?

    Hi,

    I’ve read through the massive “contracting in Belgium” thread and although it’s been very helpful it doesn’t fully cover my exact scenario.

    My scenario:
    - I've received an offer for a 6-month rolling contract in Belgium.
    - I get to work 2 days from home in the UK
    - I am an employee of a UK based Ltd company. (My wife is the director and she receives income through the Ltd as well)
    - For the 3 days a week that I am on-site at the client I’ll stay overnight with my parent who are based in Holland.

    Based on my working conditions above. Is my contract compliant with the 183-day rule?

    #2
    Originally posted by rgeurts View Post
    Hi,

    I’ve read through the massive “contracting in Belgium” thread and although it’s been very helpful it doesn’t fully cover my exact scenario.

    My scenario:
    - I've received an offer for a 6-month rolling contract in Belgium.
    - I get to work 2 days from home in the UK
    - I am an employee of a UK based Ltd company. (My wife is the director and she receives income through the Ltd as well)
    - For the 3 days a week that I am on-site at the client I’ll stay overnight with my parent who are based in Holland.

    Based on my working conditions above. Is my contract compliant with the 183-day rule?
    Will you spend more than 183 days out of the country in any one tax year? Nothing to do with the contract, everything to do with what you actually do and where you actually are. HMRC will not care what the contract says, only what your actual residency status was.

    There s also far more to it than just the 183 days.

    https://www.gov.uk/tax-foreign-income/residence
    "Being nice costs nothing and sometimes gets you extra bacon" - Pondlife.

    Comment


      #3
      Whether you are in Belgium for 183 days or less is not the only test. It also depends on other criteria including the economic employer.

      If the entity ultimately paying for your services has a permanent establishment (PE) in Belgium, then part c) of Article 15 (extract below) is failed and so the 183 day rule does not apply.

      (a) the recipient is present in the other State for a period or periods not exceeding in
      the aggregate 183 days within any period of 12 months; and
      (b) the remuneration is paid by, or on behalf of, an employer who is not a resident of
      the other State; and
      (c) the remuneration is not borne by a permanent establishment or a fixed base which
      the employer has in the other State

      As DaveB mentioned, its the actual circumstances, not what is written in a contract, that matters to both the Belgian tax authority and HMRC.

      HTH
      Last edited by Sue B; 28 September 2016, 10:10. Reason: spelling

      Comment


        #4
        Thanks for the link Dave.
        In addition to the details provided above, I own a house in the UK and my wife and 2 kids will remain based in the UK

        According to my calculations I would spend around 126 days on-site in Belgium.

        Comment


          #5
          Originally posted by rgeurts View Post
          Thanks for the link Dave.
          In addition to the details provided above, I own a house in the UK and my wife and 2 kids will remain based in the UK

          According to my calculations I would spend around 126 days on-site in Belgium.
          Sounds like you will e Tax Resident in the UK then. But I'm not an accountant or a tax expert so get some proper advice.
          "Being nice costs nothing and sometimes gets you extra bacon" - Pondlife.

          Comment


            #6
            Originally posted by rgeurts View Post
            Thanks for the link Dave.
            In addition to the details provided above, I own a house in the UK and my wife and 2 kids will remain based in the UK

            According to my calculations I would spend around 126 days on-site in Belgium.
            Is your wife also director* or are you the only director of the company?

            If you are the only director when you move location e.g. out if the UK, so does the management of your company.

            *It can be someone else e.g. a parent as long as they are UK based.
            "You’re just a bad memory who doesn’t know when to go away" JR

            Comment


              #7
              Originally posted by rgeurts View Post
              Thanks for the link Dave.
              In addition to the details provided above, I own a house in the UK and my wife and 2 kids will remain based in the UK

              According to my calculations I would spend around 126 days on-site in Belgium.
              On the face of it you'll pay Belgian tax personally and be tax resident in UK and Belgium. There is a DTA in place but as Belgian tax is so high you most likely pay none in UK.

              Ltd will be taxed in both countries too.
              Last edited by stek; 28 September 2016, 10:25.

              Comment


                #8
                Originally posted by SueEllen View Post
                Is your wife also director* or are you the only director of the company?

                If you are the only director when you move location e.g. out if the UK, so does the management of your company.

                *It can be someone else e.g. a parent as long as they are UK based.
                OP mentioned that their wife is the director (and by the sounds of it the only director).

                Comment


                  #9
                  Hi Sue,

                  Thanks for your reply.

                  If the entity ultimately paying for your services has a permanent establishment (PE) in Belgium, then part c) of Article 15 (extract below) is failed and so the 183 day rule does not apply.
                  The entity ultimately paying for my services is a UK based recruitment agency with no establishment in Belgium.
                  Last edited by rgeurts; 28 September 2016, 13:06.

                  Comment


                    #10
                    Hi CyclingProgrammer,

                    Thats correct, my wife is currently the only director.

                    Comment

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