Working remotely for UK based Ltd company

[FHK]

Hi all,

I am new to the site, and having spent some hours searching here & the internet am coming to you all for some advice or pointers to help with my query.

Background on my working status:
I am currently working (for a few years!) for a UK based ltd company as a temp, looking to become a contractor instead for all the benefits that will have & due to my accumulated work experience etc.

However I just found out my husband & I are going to be relocating on a 5yr visa to New York (for his work, very exciting!) in October. My visa is as a spouse.

I would want to (and the company wants to keep me too) work as a contractor for the same UK Ltd. company, but remotely (i.e. not in the UK).

My query:[LIST=1]
1. Can I/should I still set up as a contractor (either ltd. or umbrella) in the UK, even though I will then be moving to the USA & working remotely from home for them?
2. Will the US claim tax from me as well as the UK for what I earn?

Im sure I have another zillion questions, but I wanted to check that I would be a UK company but working from anywhere.

[Greg@CapitalCity]

Hi FHK, a ltd company arrangement usually falls apart when you consider the residency status of the UK ltd company. If you are the sole director, and all your company fee earning work is generated in the US where you live, the UK ltd contractor company will usually be deemed US resident. You would pay UK tax on any earnings derived from UK work (none, since you won't live here), and pay US tax on the company earnings derived from the US (which will be all of it).

I have only touched on the unwieldy US tax system, but know enough that this arrangement would most likely be complicated and untenable.

Working through a UK PAYE umbrella would also raise US tax, and cross border issues, but my feeling is this would be less complicated than the ltd company route.

Often the ideal solution is to work through a UK based ltd company/PAYE umbrella while you are living/working in the UK, and work through a US based structure when living and working in the US.

[d000hg]

Maybe a dumb idea, but can she have a UK Ltd to invoice through and simply not take any money out until returning to the UK (if the husband earns enough to do so)?

[Greg@CapitalCity]

Maybe a dumb idea, but can she have a UK Ltd to invoice through and simply not take any money out until returning to the UK (if the husband earns enough to do so)?

That might take care of the personal tax issues, but still leaves the sticky 'company residency' issue, which might be hard to get around.

[stek]

And you might want to consider your legal visa status in UK, you will loose your spouse visa status but if you relocate back to UK in five years time you should be able to re enter the UK after applying for ILE in the US.

I wouldn't risk re entering the UK on your spouse visa while still in date, if the IO found out it was effectively void you could face a ten year ban for attempting to circumvent the immigration rules, better to apply for a UK tourist visa if you need to visit the UK during this time, or a business visa if visiting your employer. Whatever you do don't attempt to enter the UK on a voided spouse visa!

[NotAllThere]

I currently work remotely for a UK company remotely, from Switzerland. I do not charge VAT, I and my company are Swiss resident and pay tax only in Switzerland. To be able to do this, I have to be legally able to work in Switzerland, and have a Swiss registered company.

I would imagine the situation in the US would be similar. You must check that you can legally work, even for an off-shore company remotely, in the US.

[FHK]

Hi All,

Thanks so much for your advice & input. It is very much appreciated, and gives me enough food for thought over the coming week before I make a decision on my next steps (better understanding of 'company residency' for starters!)

I think I was hoping that somehow it didn't matter where my laptop & I (or the company I set up) are actually physically located if the company i'd be contracting for were in the UK.

Better put the idea of working from a beach in the Caribbean with a coconut cocktail back in it's box for now.

Again, thank you!

[BlasterBates]

You're taxed where you work. So you'd have to setup a US company or register self-employed. That is the same everywhere.

[Carrie]

please help

I currently work remotely for a UK company remotely, from Switzerland. I do not charge VAT, I and my company are Swiss resident and pay tax only in Switzerland. To be able to do this, I have to be legally able to work in Switzerland, and have a Swiss registered company.

I would imagine the situation in the US would be similar. You must check that you can legally work, even for an off-shore company remotely, in the US.

So in order to invoice through the UK company from overseas, you need an overseas company in the country of residence? Then do you cross charge the income from the UK Ltd company to the overseas one where the tax is payable? (so net income in the UK entity is nil?) How is that done? as a management charge? Any help would be appreciated- I have moved to Canada but have continued to invoice through UK ltd company for work for UK clients. Being in canada was only supposed to be a temporary thing so I didn't look into the issues in too much detail- but I have now been in Canada for 8 months and am really worried.

[ldn]

So in order to invoice through the UK company from overseas, you need an overseas company in the country of residence? Then do you cross charge the income from the UK Ltd company to the overseas one where the tax is payable? (so net income in the UK entity is nil?) How is that done? as a management charge? Any help would be appreciated- I have moved to Canada but have continued to invoice through UK ltd company for work for UK clients. Being in canada was only supposed to be a temporary thing so I didn't look into the issues in too much detail- but I have now been in Canada for 8 months and am really worried.

Did you ever get an answer on this Carrie?