Contracting from Spain

[m0n1k3r]

91 days is quite a lot. If you have left, then apart from a few weeks a year visiting family, why would you be in the UK that much? You live and work in Denmark, why would you be in the UK 25% of your time?

To go to Blackpool on holiday of course. They have lots of holidays in Denmark.

[m0n1k3r]

A UK company can be owned by someone that lives overseas, the registered office just needs to be in the UK, your accountant will probably allow this for a charge. Some Spanish folks I used to work with used to fly in on a Monday and fly out on a Thursday, doing 5 days hours in 4 days, so it is possible, think this (along with holidays etc) got round the 183 day rule, but they were Spanish Nationals. Don't know if they were using a UK LTD but they were contractors. Setting up a Spanish Ltd can be a pain.

Although living in Spain and having a Spanish business set up to provide services to clients in the UK is perfectly legal, most UK recruitment agencies won't work with anything else than UK Ltd Co's and pay into UK business bank accounts.

[VectraMan]

A UK company can be owned by someone that lives overseas, the registered office just needs to be in the UK

But as I understand it if it is managed from overseas then the company is tax resident overseas, which means paying Spanish CT. I don't know how that works but it sounds like it would be complicated. Presumably you'd need to still file accounts for Companies House, but file something with HMRC to say you're exempt from UK CT.

[DimPrawn]

But as I understand it if it is managed from overseas then the company is tax resident overseas, which means paying Spanish CT. I don't know how that works but it sounds like it would be complicated. Presumably you'd need to still file accounts for Companies House, but file something with HMRC to say you're exempt from UK CT.

Thank goodness everyone being in the EU cuts through all the complexity, confusion and paperwork.

[m0n1k3r]

But as I understand it if it is managed from overseas then the company is tax resident overseas, which means paying Spanish CT. I don't know how that works but it sounds like it would be complicated. Presumably you'd need to still file accounts for Companies House, but file something with HMRC to say you're exempt from UK CT.

If it is run overseas then it should be registered as a 'foreign branch' in that country and maintain a separate bookkeeping for the branch and have a separate bank account for the branch.

It works quite well with UK companies. UK limited companies can apply for foreign branches to be taxed only in the country the branch is registered in, and if there is no UK business going on then the UK part is largely considered being dormant.

However if the purpose of the company is for a non-UK resident to contract in the UK then you either need to be able to evidence that all company management, meetings etc takes place in the UK (and some foreign tax authorities still won't accept that), or have a deep dive into double-taxation treaties between the UK and Spain to figure out what should be declared and taxed where.

[BlasterBates]

But as I understand it if it is managed from overseas then the company is tax resident overseas, which means paying Spanish CT. I don't know how that works but it sounds like it would be complicated. Presumably you'd need to still file accounts for Companies House, but file something with HMRC to say you're exempt from UK CT.

It is actually quite simple. If you are using your Ltd overseas you simply register in the country where you are doing your business and pay tax there. Plenty of German companies use the Ltd rather than the GmbH as it is cheaper. Just go and see an accountant as you would in the UK and let him set it up for you. There is no tax to pay in the UK.

[m0n1k3r]

It is actually quite simple. If you are using your Ltd overseas you simply register in the country where you are doing your business and pay tax there. Plenty of German companies use the Ltd rather than the GmbH as it is cheaper. Just go and see an accountant as you would in the UK and let him set it up for you. There is no tax to pay in the UK.

... or was. Nowadays Germany have the UG company that only requires €1 in share capital (although they are typically set up with a minimum of €1000 or more) and can be converted to a GmbH once the capital in the company exceeds €25000.

[oliverson]

so, I have a very real prospect of picking up some work in Spain but I'm not sure how to play it.

Looking at the tax over there, it seems quite onerous. If I contracted through my UK Limited company servicing their UK operation but carried out my duties at their Spanish offices, would the tax situation be the same as if I was working from their UK offices? I'd like to keep things as simple as possible.

[doconline]

so, I have a very real prospect of picking up some work in Spain but I'm not sure how to play it.

Looking at the tax over there, it seems quite onerous. If I contracted through my UK Limited company servicing their UK operation but carried out my duties at their Spanish offices, would the tax situation be the same as if I was working from their UK offices? I'd like to keep things as simple as possible.

Are you direct or through an agency?

IANAA but if you are being paid by a UK company to your UK company, the corporation tax etc should stay the same with your company liabilities staying the same. however, your personal tax situation will change if you are over in Spain for an extended period of time. How long will you be there for? Regarding your personal tax situation, it would be better to speak to an accountant in Spain about it, and find out the best way for you to set up.

[oliverson]

The contract will probably be direct between my UK Ltd company and their UK company, but if there was an agent involved it would also likely be a UK company.

The way I'm seeing it, nothing much changes unless I live over half-the-year in Spain.