Working remotely for a UK client from an EU country

[jamesbrown]

Agree with the above - it will not be smooth, even for those with relatively simple circumstances (faffing with deemed payments to UK resident companies), let alone a cross-border element.

[skysies]

What would be the preferred way of trading with the client? Currently, we all have a contract with an agency based in the UK. Post Apr-21, I think the end client would require us to go through an umbrella if we are all found inside IR35.

So in that case, can I set up a limited company in the EU country I'm moving to? Will the contract then be between this LTD and the agency? Where will the umbrella be in all this? What happens to my UK limited company?

[NotAllThere]

So in that case, can I set up a limited company in the EU country I'm moving to? Will the contract then be between this LTD and the agency? Where will the umbrella be in all this? What happens to my UK limited company?

Depending how well you negotiate:

Yes. Yes. There can't be an umbrella involved. It closes down.

or

Yes. No. Paying you as an employee, perhaps after deductions, perhaps not, but leaving you liable to social contributions in your host country. It closes down.

[skysies]

It might be necessary to run the contract through two companies, one in the UK and one in your country of residence. You then bill the UK Ltd from your foreign company.

What do you mean by UK LTD? I thought if I keep my company here and invoice through it for the work I do outside the UK, I would potentially be liable to UK taxes?

[BlasterBates]

What do you mean by UK LTD? I thought if I keep my company here and invoice through it for the work I do outside the UK, I would potentially be liable to UK taxes?

Yes you should bill from a company registered in the country you're working in.

[skysies]

Yes you should bill from a company registered in the country you're working in.

Yes, that makes sense. When you say "It might be necessary to run the contract through two companies, one in the UK and one in your country of residence."

Do you mean the UK company is the agency?

[BlasterBates]

Yes, that makes sense. When you say "It might be necessary to run the contract through two companies, one in the UK and one in your country of residence."

Do you mean the UK company is the agency?

I mean if the agency were to refuse to allow you to bill from a foreign company, but that makes it complicated. In that case you would bill via the UK ltd, and then bill the UK Ltd from your foreign company. In effect you would have very little or no profit in the UK company.

[skysies]

I mean if the agency were to refuse to allow you to bill from a foreign company, but that makes it complicated. In that case you would bill via the UK ltd, and then bill the UK Ltd from your foreign company. In effect you would have very little or no profit in the UK company.

Yes, it's likely that the agency won't deal directly with a foreign company. So that would imply keeping my UK LTD? Would that be even possible if I want to get the non-resident status and pay my taxes in the EU country that I will be moving to? I don't remember where, but someone said that one of the things I need to do is close my UK LTD.

[BlasterBates]

Yes, it's likely that the agency won't deal directly with a foreign company. So that would imply keeping my UK LTD? Would that be even possible if I want to get the non-resident status and pay my taxes in the EU country that I will be moving to? I don't remember where, but someone said that one of the things I need to do is close my UK LTD.

In this case you would bill the UK Ltd from your foreign company.

Before Brexit you could have set up two branches of your UK Ltd one in the UK and one in the country where you were resident, but that probably won't be possible.

You need to contact Sue at IPAYE, this will be very difficult to figure out by asking questions here.


https://www.contractoruk.com/forums/...ief-guide.html

[lecyclist]

I agree with BB concerning a multiple company setup. There are many advantages related to conducting business through companies in multiple tax jurisdictions. The simplest one concerns corporation tax years. European countries normally align corporation tax with calendar years (Jan-Dec) while UK corporation tax is on a variable calendar (Director chooses the company tax year).

There are opportunities to front-end (advance payment on services) or back-end (payment for services rendered) transfer pricing between connected or unconnected companies to delay the point of taxation. The idea of postponing taxation until the point of profit distribution is what has made Estonia and e-residency particularly attractive for example (as you would imagine, it's not that simple).

I would emphasise though how important it is to seek professional advice before you commit to a particular tax setup. I've spent years working all over mainland Europe (since 1996), and I would still seek tax advice before beginning a new venture in a jurisdiction I was unfamiliar with, as tax legislation changes constantly. You will be unlikely to get the appropriate advice for free on the internet, and especially not in an UK based forum. Or worse, you will make decisions based on advice that has not aged well.