International Limited Company (moved)

[cojak]

Moved from General.

Hi all

I've been contracting in the UK as a Java backend developer for a long time and like many on this forum, I've always been careful to seek contracts outside IR35. Every year, the gap between being paid permanently and being a contractor has been shrinking and I honestly think that today, there really isn't any financial advantage to contracting versus a well paid permanent role. I'm considering, holiday pay, pension contributions by the company, private healthcare for a family of four, annual bonus and sick pay.

Two years ago when the pandemic started and I exclusively worked remotely, I decided to take on two contracts simultaneously. Initially I found it tough, but once I negotiated meeting clashes the only downside was a slightly longer working day but I doubled my income albeit, my corporation tax has also doubled.

I have been doing this comfortably for a while now and wondered if I could take this further, especially due to the increase in corporation tax effective April 2023. Does anyone know, if I set up an international company, would I be able to convince UK and US technology companies to consider me for IT contract roles via the usual UK recruiters?

I'm looking to reduce my tax bill legitimately here so I don't want to do anything which would ruffle HMRC.

Thanks in advance.

Gary.

[jamesbrown]

Not going to work. All you're doing is creating an additional headache, dealing with overseas admin and tax. Either way, you'll create a UK permanent establishment and the economic activity that generates the profits will be carried out from the UK, so the foreign entity will be subject to UK corporation tax.

[northernladuk]

So your clients would only get a third of the value they are paying for instead of half?

<puts tin hat on and sits patiently in trench>

I don't think you'll get US roles through the usual recruiters would you? I'd be looking at your market and understanding that first before deciding what model to use and what the figures would be.

[TheGreenBastard]

What's the added complexity of an "international company" going to do? Do you think you could swindle proceeds through some low tax jurisdiction and not pay HMRC her due?

Totally unnecessary, UK Ltds. have a good perception and anyone looking to engage you from the US/EU will be aware and be able to pay such an entity directly, B2B.

I'm big into multi-gigging myself, but why are you whinging about double relative tax on double Ltd. company income? Pop two high paying PAYE roles in a calculator if you want to see something unfair.

I have US and EU clients, I'm not sure they'd engage bog standard Java developers, the Yanks might if there's a cost arbitrage opportunity, but generally I've been contacted directly (LinkedIn) or by regular agents, probably a 50/50 split.

[Fred Bloggs]

I'm looking to reduce my tax bill legitimately here so I don't want to do anything which would ruffle HMRC.

Another case of trying to be a bit too clever?