employment status..

[jamesbrown]

If you want hire someone in France you need to setup a business there, this is why getting your employee to also run/setup the French subsiduary would be a good idea, even if it is partttime. I think being self employed would be a good idea here too.

You can't simply employ someone from a foreign company, not registered in France, apart from short term visits, and you have to handle all the French regulations.

Obviously you can do this from your Ltd but it would be a separate branch entirely with it's own set of accounts, i.e. the effort is the same as setting up a French company.

The profit attributable to the work your French employee is carrying out would be taxable in France.

That's my understanding , and why for this kind of venture you want partners i.e. other companies/self employed.

Exactly, and that's why I'd much prefer subcontracting a company/self-employed person in general, but it wasn't a (straightforward) option in this case - it's tied to a specific source of funding with onerous requirements on subcontractors. Based on what ASB is saying, it sounds as though it might be simpler for a foreign employer hiring someone in the UK. I knew France was a tough one in terms of employment law (with criminal vs. civil consequences too).

[ASB]

Interesting. I've actually been looking into this from the reverse angle recently (hiring a part time employee in France) and it appears that there is a legal obligation in that case (with potential criminal consequences). Do you have any links to explanations of this from a UK perspective, i.e. that it is a preference of HMRC rather than a requirement? I thought it was pretty much standard everywhere that, to employ someone in another country, you have to satisfy the same requirements as a local employer.

There was a thread recently in which I put up some links from the stuff on HMRC website. But that is covering the situation of a Foreign company with no branch but UK based employees. This was in the context of a US citizen. The law for TAX and NI are different. Also whether the employer is EU or not changes some things WRT to NI. There is a difference between HMRC procedures and expectations and actual legal requirements. However HMRC are the ones with the power.

In terms of an employee in France there are some strict French rules as BB pointed out.

[BlasterBates]

Interesting. I've actually been looking into this from the reverse angle recently (hiring a part time employee in France) and it appears that there is a legal obligation in that case (with potential criminal consequences). Do you have any links to explanations of this from a UK perspective, i.e. that it is a preference of HMRC rather than a requirement? I thought it was pretty much standard everywhere that, to employ someone in another country, you have to satisfy the same requirements as a local employer.

If you want hire someone in France you need to setup a business there, this is why getting your employee to also run/setup the French subsiduary would be a good idea, even if it is partttime. I think being self employed would be a good idea here too.

You can't simply employ someone from a foreign company, not registered in France, apart from short term visits, and you have to handle all the French regulations.

Obviously you can do this from your Ltd but it would be a separate branch entirely with it's own set of accounts, i.e. the effort is the same as setting up a French company.

The profit attributable to the work your French employee is carrying out would be taxable in France.

That's my understanding , and why for this kind of venture you want partners i.e. other companies/self employed.

[Sausage Surprise]

etc and advice

[jamesbrown]

hmrc like all these things to happen. But there is no actual obligation.

Interesting. I've actually been looking into this from the reverse angle recently (hiring a part time employee in France) and it appears that there is a legal obligation in that case (with potential criminal consequences). Do you have any links to explanations of this from a UK perspective, i.e. that it is a preference of HMRC rather than a requirement? I thought it was pretty much standard everywhere that, to employ someone in another country, you have to satisfy the same requirements as a local employer.

[ASB]

BB, the way I read the OP is that they're operating as a sole trader. Could be wrong though. If so, and the OP is in an employment type arrangement, the OP could still be deemed employed, but not in terms of IR35. In that case, the employer should strictly register as an employer in the UK and operate PAYE. Could be a very messy situation if HMRC dispute the arrangement.

Regarding registration, the employer does not have to register a paye scheme. The employer does not have to operate paye. The employer does not have to operate a uk branch.

hmrc like all these things to happen. But there is no actual obligation.

The ni situation is different. For the purposes of secondary contributiond the employer may have a deemed place of business. This means they should pay over ers ni on emoluments.

[jamesbrown]

Since the Italian tax authorities accept your self-employed status and HMRC's only access to information is through the Italian tax authorities, who probably won't co-operate anyway, the only thing they have to go on is what you tell them and your contract. As long as your contract is IR35 friendly I think you could declare yourself as self-employed. The fact that you're in the UK and the company in Italy means you probably work independently anyway.

I would talk to an accountant about your contract. If you understand the rules and you feel you are self-employed then you should be OK, basically their evidence would be what you told them and the contract, which of course could potentially put you inside IR35.

BB, the way I read the OP is that they're operating as a sole trader. Could be wrong though. If so, and the OP is in an employment type arrangement, the OP could still be deemed employed, but not in terms of IR35. In that case, the employer should strictly register as an employer in the UK and operate PAYE. Could be a very messy situation if HMRC dispute the arrangement.

[BlasterBates]

Since the Italian tax authorities accept your self-employed status and HMRC's only access to information is through the Italian tax authorities, who probably won't co-operate anyway, the only thing they have to go on is what you tell them and your contract. As long as your contract is IR35 friendly I think you could declare yourself as self-employed. The fact that you're in the UK and the company in Italy means you probably work independently anyway.

I would talk to an accountant about your contract. If you understand the rules and you feel you are self-employed then you should be OK, basically their evidence would be what you told them and the contract, which of course could potentially put you inside IR35.

[ASB]

It sounds as though you are being treated as self employed. You personally send them an invoice.

It sounds as though you would fail the s/e tests. See hmrc booklet ir56.

This makes you their employee. This could lead them to a modest amount of pain. I assume they have no branch in the uk.

This means you must operate the paye scheme on your gross income. Hmrc are not usually enthusiastic about this.

The position on ers ni is debatable. But it may not be due.

there is a chunk of info on hmrc website on uk based employees of foreign employers.

It is not clear why you are asking, employees rights could be interesting. Also it appears you may have been wrong for the last 11 years.

[VectraMan]

Based on that you said you were self employed, then perhaps the answer is that you're self employed?

[stek]

Just make sure you get double what your on now and you should be ok..

[jmj121]

Hi,

i need to work out, if i'm employed by an Italian company.

I have been working for this company for the last 11yrs as a engineer, looking after the UK. They asked me to set myself up as a self employed person, to make it easier for them... they tell me what to do and when ect... they pay for all my expenses,accounting fee's, car lease, mobile and fuel all paid in the one monthly expense invoice.

Now its all getting kinda complicated and there constantly changing how they pay me ect.. normally i invoice them once a month a consultancy fee and an expenses invoice and they pay...

So, what im trying to work out is would i be seen as an employee,as i only work for them and have done for 11yrs...

from what i understand in the UK, i would be. but dont know how i would find out in Italy..my status..

Thanks for your advise.

Jason

the simplest answer would be for them to employ me and i would have a much easier life !!
how do i go about finding out my employment status...