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TaxVince
TaxVince, Accountant
Category: UK Tax
Satisfied Customers: 961
Experience:  Chartered Accountant >20 years + Qualified IFA
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HiI am a UK citizen currently in Australia and paying Australian

Resolved Question:

Hi

I am a UK citizen currently in Australia and paying Australian taxes

I have been offered a position in Africa that i am considering. The pay from that job would go through the UK agency who are looking at hiring me for the company who are based in Africa

I will continue to live in Australia (visitor visa - not Australian PR) and work only in Africa but the pay must go through the UK

I have been advised by the hiring Agency that i require a Limited Company or an umbrella company in order to receive my pay. Having spoken to an umbrella company, given i am not living, working or ordinarily resident in the UK, so they say they cannot take me on to their books

Does anyone know if i can form my own Limited Company under those conditions and also if i can claim back tax in such circumstances

Mant thanks in advance

Ralph
Submitted: 10 months ago.
Category: UK Tax
Expert:  Rachel-Mod replied 10 months ago.

Hello,

I'm Rachel, and I’m a moderator for this topic.

We have been working with the professionals to try to help you with your question. Sometimes it may take a bit of time to find the right fit.

I was checking to see if you had already found your answer or if you still needing assistance from one of the professionals.

Please let me know if you wish to continue waiting or if you would like for us to close your question.

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Customer: replied 10 months ago.
Hi Rachel

I do require an answer to this, either from here or elsewhere. I assume if i receive no response and the question is closed that i will not be charged?

Thanks
Ralph
Expert:  Rachel-Mod replied 10 months ago.

Hello,

Thank you, XXXXX XXXXX continue to look for a professional to assist you. In the event we are unable to find a professional for you yes the question can be closed and you will not be charged. Please let me know if I can be of any further assistance while you wait.

Best,

Rachel

Expert:  Lindie-Moderator replied 10 months ago.

Hello again, :)

We are still working with the professionals to find you the best possible match. I wanted to touch base to see if you still needed a professional’s assistance.

Please let me know if you would like to continue to wait or if you would like to cancel your question at this time. We sincerely XXXXX XXXXX the extended wait time.

Thank you,

Lindie

Customer: replied 10 months ago.

Hi Lindie


 


I am happy to wait


 


Thanks


Ralph


 

Expert:  TaxVince replied 10 months ago.
Hi. Thanks for your question.

Should you find the answer below incomplete or you are not fully answered, please drop a reply before rating.

Why do you need a UK company or agency? Or why does the pay have to pass through UK?

Regards
Expert:  TaxVince replied 10 months ago.
Any update?
Customer: replied 10 months ago.

Hi


 


Apologies for the slow response but i am presently offshore in Australia


 


The Agency who is arranging the work is based in the UK and they have told me that they require it to be paid within the UK to keep themselves compliant. I think it is to ensure that it goes through the UK tax system. I am ok with that but need to know if I will be liable for tax or NIC given i shall be working and living outside the UK


I believe I can become NT for tax and therefore will not pay tax, but i am unsure about NIC


 


Thanks

Expert:  TaxVince replied 10 months ago.
Thanks for the reply.

Firstly you are non resident and wont be individually taxed in UK as you automatically qualify for non residency under the Automatic Non Residence Test as long as you don't spend more than 91 days in UK.

In this case you wont be required to file any tax documents with the UK tax office nor are you required to pay tax in UK.

However if you set up a LTD company, a company registered in UK is tax resident in UK and hence the company will pay tax in UK at minimum 20% despite the work being done outside UK. Hence i do not see the reason for setting up a UK company.

It might be useful to get a UK tax accountant to liase directly with the UK agent to understand the full arrangement of your contract and see whats best for your case taking into account your position in Australia, how to claim any double tax that may be incurred at South Africa level. Unfortunately Justanswer.com doesn't allow direct contact, therefore you might try other sites like HERE or simply google if you feel the need to do so - but the overall view is that you don't need a UK LTD.

Let me know if you are answered and if you have any further questions drop me a message. If sorted ,could you please rate the question before you go.
Regards
Customer: replied 10 months ago.

Thanks for the reply - very informative. I guess the only thing to ask is if there is an alternative to a Ltd Co


 


The agency are clear that they will not pay me directly. At the start they said they would pay me via an umbrella company but that is not an option for me as i will neither work nor live in the UK. Their advice was therefore to form a Ltd Co - I did hear that if I did that then I would be liable to employer tax at 13.8% on earnings over around 140 per week??

Expert:  TaxVince replied 10 months ago.
They are right in that if you set up a UK company and you are employed by a UK company, then over and above the company tax of 20%, the company will pay national insurance tax as well..

The option available to you is the umbrella company which is essentially a company that acts as an employer to you and you will then work under a fixed term contract assignment with this company- this is usually through your agent in UK. The umbrella company then processes timesheets received from you then issues an invoice to the client in South Africa for payment. The umbrella company should then comply with all the UK tax requirements for an employer like any other employer. However you being non resident means the umbrella company needs to be made aware about this and they will get a NIL code from HMRC to say you should be taxed in UK.

Hope this helps
Expert:  TaxVince replied 10 months ago.

Hope this helps. If you are not satisfied, please do NOT rate but get back to me ASAP.

Expert:  TaxVince replied 10 months ago.
Could you please rate the question. Thank you .
TaxVince, Accountant
Category: UK Tax
Satisfied Customers: 961
Experience: Chartered Accountant >20 years + Qualified IFA
TaxVince and 2 other UK Tax Specialists are ready to help you

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