Reply to: Umbrella if not UK resident

[eek]

wow, what a patronising reply, not sure what your credentials are but clearly you know better than the 3 professionals I have spoken to just to be sure. Do you have personal experience of the same situation?

So what umbrella firm are you using?

[jamesbrown]

clearly you know better than the 3 professionals I have spoken to just to be sure. Do you have personal experience of the same situation?

Well, that's excellent news. I'm sure you won't be needing any lube in the near future.

Yes, I have experience of contracting in several countries. You've had three people in this thread, all of whom have some experience of international working and taxation, tell you the same thing.

[panders]

wow, what a patronising reply, not sure what your credentials are but clearly you know better than the 3 professionals I have spoken to just to be sure. Do you have personal experience of the same situation?

I think you're confused or perhaps you confused whomever you spoke to or perhaps the person you spoke to was confused or perhaps all of these things. Remember, any given person at HMRC can be completely clueless and that will not be an excuse when you make a mistake (this is why you should seek advice from a professional and not from HMRC). Anyway, tax is payable on your locally earned income where the work is done, not after 6 months. Tax is payable on your worldwide income where you're tax resident. There may be a tax treaty to offset double taxation of the same income.

[BlasterBates]

Hi there just thought I’d update that according to HMRC if I am not resident in the UK for tax purposes I don’t pay tax in the UK if I work for less than 6 months, UK tax only becomes payable after 6 months, so my earnings are declared locally and I pay tax where I am resident.

If you're non-resident you still pay tax on UK earnings. The main difference is when you become resident you are taxed on worldwide income.

HMRC don't use the term tax-resident, they use the term resident.

https://www.gov.uk/tax-uk-income-live-abroad

You usually have to pay tax on your UK income even if you’re not a UK resident. Income includes things like:

• pension
• rental income
• savings interest
• wages

If you work less than 6 months HMRC would tax you on your income as a non-resident.

[jamesbrown]

Hi there just thought I’d update that according to HMRC if I am not resident in the UK for tax purposes I don’t pay tax in the UK if I work for less than 6 months, UK tax only becomes payable after 6 months, so my earnings are declared locally and I pay tax where I am resident.

I think you're confused or perhaps you confused whomever you spoke to or perhaps the person you spoke to was confused or perhaps all of these things. Remember, any given person at HMRC can be completely clueless and that will not be an excuse when you make a mistake (this is why you should seek advice from a professional and not from HMRC). Anyway, tax is payable on your locally earned income where the work is done, not after 6 months. Tax is payable on your worldwide income where you're tax resident. There may be a tax treaty to offset double taxation of the same income.

[panders]

Hi there just thought I’d update that according to HMRC if I am not resident in the UK for tax purposes I don’t pay tax in the UK if I work for less than 6 months, UK tax only becomes payable after 6 months, so my earnings are declared locally and I pay tax where I am resident.

[NotAllThere]

Just wondering how things worked out for you? I'm in a similar situation in that I am resident for tax purposes in Guernsey and will be doing a contract in the UK where I only need to be on UK soil 50% of the working week. In terms of UK tax I am non resident there for tax purposes but need to pay tax in Gsy on my global income. Umbrella's seem to be struggling with what to do, some have suggested HMRC will issue me with a NI tax code and I wont be taxed in UK, others have suggested I go the self-employed route and others just PAYE and claim back my UK tax.

Income coming from the work you've physically carried out in the UK is taxable in the UK. Residency is irrelevant. NI is also due. You may be tax resident - there's more to it that 180 days rule. https://www.gov.uk/tax-foreign-incom...e%20tax%20year

Any tax you're charged in the UK and Guernsey will be offset against each other. I.e. you won't be taxed twice on the same income.

[panders]

Just wondering how things worked out for you? I'm in a similar situation in that I am resident for tax purposes in Guernsey and will be doing a contract in the UK where I only need to be on UK soil 50% of the working week. In terms of UK tax I am non resident there for tax purposes but need to pay tax in Gsy on my global income. Umbrella's seem to be struggling with what to do, some have suggested HMRC will issue me with a NI tax code and I wont be taxed in UK, others have suggested I go the self-employed route and others just PAYE and claim back my UK tax.

[jamesbrown]

Sounds like the OP has a woefully out-of-date understanding of the UK tax residency rules, which determine whether they pay tax on their worldwide income in the UK (with treaty protections TBD). Obviously, you pay tax on work based on where the work is performed, regardless of tax residency, but the OP is quite probably UK tax resident too.

[NotAllThere]

...

there are afew umbrella companies that will enable you to be paid gross, and sort out the billing process with the end client....

Sounds more like an agency set up than a brolly.

[eek]

Hi
i am a UK citizen, resident and working in Malta
i make my living doing UK contract work..

there are afew umbrella companies that will enable you to be paid gross, and sort out the billing process with the end client...

in my experience they all do charge around 5% of your rate for this service.

you then need to use an accountant in Malta
to do your maltese tax return and VAT - you also need to pay your NI contributions..

you charge VAT At 0% - but have to legally be register if your turn over exceeds 25k euros

the best umbrella to Speak to is Sapphire,
there are others such as International Umbrella ltd..

Hope this helps

Heads off to read the FSCA's charter to see what it says about this type of scheme (where a umbrella is pretending to "employ" an overseas worker).

Hmm, it doesn't cover it - one for Mr Bryce when he arrives.

[martinInMalta]

Hi
i am a UK citizen, resident and working in Malta
i make my living doing UK contract work..

there are afew umbrella companies that will enable you to be paid gross, and sort out the billing process with the end client...

in my experience they all do charge around 5% of your rate for this service.

you then need to use an accountant in Malta
to do your maltese tax return and VAT - you also need to pay your NI contributions..

you charge VAT At 0% - but have to legally be register if your turn over exceeds 25k euros

the best umbrella to Speak to is Sapphire,
there are others such as International Umbrella ltd..

Hope this helps

[NotAllThere]

Thanks for the replies and input chaps.

Currently I'm looking for a contract, which might come under IR35, it might not, it depends on client, but I generally do short term project work.
I am planning to work from Malta and was looking for an Umbrella who could handle payroll for me.

AIUI, legally, you do not have to go through a brolly nor do you need a payroll company. You should be able to invoice the client or the agency directly (notwithstanding local Maltese laws).

However, as Eek rightly points out, many clients and agents will simply move on to the next UK based, easy to handle contractor. Clients and agencies are risk averse. There have been discussions about this scenario in this and the main Accounting/Legal forum. I suggest you have a look there. There's a company called International Umbrella - they may be able to help, this is not a recommedation.

In my case, I was the person wanted by the client before we ever began to look at at how to handle payment.

[cojak]

May I refer you to the threads regarding Germany and Belgian tax inspectors - and suggest you think for a minute.

I'm sorry to say this but as a Moderator you really should not be posting on things where it is clear that you don't understand the complete picture as remember this is in the umbrella companies channel which is about becoming an employee of an umbrella company and the consequences of doing so.

Finally

I hope Cojak has plenty of time post retirement as she will have to answer the questions I usually deal with here.

They'll have to go unanswered I'm afraid as you have more knowledge than I have and I have neither the energy nor motivation to learn it.

[ExpatChris]

Thanks for the replies and input chaps.

Currently I'm looking for a contract, which might come under IR35, it might not, it depends on client, but I generally do short term project work.
I am planning to work from Malta and was looking for an Umbrella who could handle payroll for me.