English Ltd Co contractor working in Scotland?

[Fred Bloggs]

If an English Ltd Co contractor (Ltd Co registered in England) lands a couple of years work in Scotland, commutes up there each week to work then home at the weekends. Does he/she pay English tax or Scottish tax? And if some of the stuff is done WFH, then is English and Scottish tax levied pro rata? Seems very messy and uncertain to me and a mate I am trying to help out.

[Jessica@WhiteFieldTax]

I'm sure you've googled, but have you seen this

https://www.gov.uk/guidance/work-out...-of-income-tax
(noddy guide)

or

https://www.gov.uk/hmrc-internal-man...nical-guidance
(hmrc manual - guide to staff. May not always reflect law, but reflects how HMRC interpret the law)

[Fred Bloggs]

I'm sure you've googled, but have you seen this

https://www.gov.uk/guidance/work-out...-of-income-tax
(noddy guide)

or

https://www.gov.uk/hmrc-internal-man...nical-guidance
(hmrc manual a- guide to staff. May not always reflect law, but reflects how HMRC interpret the law)

Thanks, yes, what confuses me is that generally you pay the tax where you work not where you live. But in this case it seems the other way round. It seems odd. For example, if you have a job over the border but live the other side of the border a few yards away, then the tax is based on where your house is not where you work. But if I work in Scotland, my house is in England, but stay four nights a week in a flat in Scotland, where do I "live"? It seems very ill thought through and very confusing to me.

Just to add, I think the Kilmarnock example makes you an English tax payer.

[adubya]

It looks fairly clear to me

Your main home is usually where you live and spend most of your time. It doesn’t matter whether you own it, rent it or live in it for free.

Your main home may be the home where you spend less time if that’s where:

most of your possessions are
your family lives, for example, if you’re married, in a civil partnership or a long-term relationship
you’re registered for things like your bank account, GP or car insurance
you’re a member of clubs or societies

[Fred Bloggs]

It looks fairly clear to me

Thanks, yes, what is very odd is the general rule that you pay tax where you work not where your house and family are. And here we have the exact opposite.

[NotAllThere]

Thanks, yes, what is very odd is the general rule that you pay tax where you work not where your house and family are. And here we have the exact opposite.

If you working internationally, you may well find you pay tax where you work and where your home is.

[Fred Bloggs]

If you working internationally, you may well find you pay tax where you work and where your home is.

Indeed. And I do. But not on the same money, since the dual tax treaties between the UK and other jurisdictions generally ensure that to be the case.

[Jessica@WhiteFieldTax]

Apologies, Fred, didn't get back to this yesterday. Is it clearer now, in practice if not in theory?

It seems the Scottish Tax Rates rely on residence rather than location of work, which, as you say, is unusual viz international tax, but is ore akin to some of the principles we see in CGT around Main Residence. And that makes sense to a degree as this is a regional tax on residents rather than a tax on work / economic activity per se.

In a world in which a Chocolate Milkshake is vat free, but a Strawberry or Banana milkshake is vatable (tribunal earlier this year), alas tax seems to get more complex by the week.

[Maslins]

In a world in which a Chocolate Milkshake is vat free, but a Strawberry or Banana milkshake is vatable (tribunal earlier this year), alas tax seems to get more complex by the week.

Good to know, we get asked this a lot!

[Fred Bloggs]

Apologies, Fred, didn't get back to this yesterday. Is it clearer now, in practice if not in theory?

It seems the Scottish Tax Rates rely on residence rather than location of work, which, as you say, is unusual viz international tax, but is ore akin to some of the principles we see in CGT around Main Residence. And that makes sense to a degree as this is a regional tax on residents rather than a tax on work / economic activity per se.

In a world in which a Chocolate Milkshake is vat free, but a Strawberry or Banana milkshake is vatable (tribunal earlier this year), alas tax seems to get more complex by the week.

Much appreciated Jessica. I was unaware of the milk shake farce actually (Jaffa cakes and the pasty tax spring to mind), but I have believed for a number of years that the entire UK tax system is now irretrievably broken due to persistent meddling and fiddling by successive chancellors. And it actually seems to be getting still worse now with the Scotland and England income tax stuff. Thanks again.