Working for UK companies remotely from the EU

[richtow]

Hi all,

My family & I are moving to Italy and I wanted to get your opinions on the possibility/feasibility of contracting for UK companies whilst resident in the EU. I should point out that I will also look for work in Italy as I can speak the language, which would simplify our tax affairs but I would also like the option of working for UK based companies remotely from Italy. I have consulted a tax advisor but they were not specialists in non-UK tax/double taxation, but I will do that before proceeding, so this is just to get advice from those (if any!) who have tried this.

I believe the options are:

1) Umbrella: Some umbrella companies do support non-resident workers. My wife will be using an umbrella but in her case the umbrella company actually has a presence in Italy so she will be on the payroll there. Does anyone have experience of either setup? Also, if we are tied to a a particular umbrella company, are clients generally amenable to using an umbrella of the employees choosing, or can that be an issue?

2) Using a PSC, either inside/outside IR35. My concern here is double taxation. Does anyone have experience of requesting tax refunds/credits where double taxation applies and what was your experience?

3) Using my limited company in the UK to bill my UK client but use my own Italian company to receive payment for services. This would mean income tax etc would not be paid to HMRC but to Italian tax authorities instead and hopefully avoid the complication of double taxation.

Thanks for your time,
Regards,
Rich

[Fred Bloggs]

The starting point is always that you pay tax where you are sitting doing the work.

[BlasterBates]

You need to avoid paying yourself via a PSC which generates UK taxable income. The right way to do this is option 1 or 3 i.e. to register yourself in Italy and pay tax there. If you pay tax in the UK and offset this against tax in Italy you might get into trouble as you should be paying tax in Italy exclusively, not reducing your tax bill because you pay tax in the UK. If you find you have no choice but to invoice via a UK Ltd company then I would follow up on option 3, probably by invoicing the UK Ltd from your Italian registered business. I believe there are umbrella companies that can help set up cross-border arrangements.

[mem80]

I have been researching those options and talked to my friend couple of weeks ago. He is back to Poland and what he described he did is exactly the option 3.