Working abroad isn’t as easy as packing a suitcase and jumping on the plane! There are important things to consider and with our help here at Futurelink Group, we can make the process a little easier.
With our payment solutions, we can ensure that you will be tax compliant wherever you are working, without paying more in tax than you need to.
So, here is useful information if you’re thinking of making the leap…
How will I pay my taxes overseas?
Generally, if you work for longer than six months abroad (180 days plus 3 days travel), any income you have made will more than likely be taxed in the country where you are working, unless:
- You have been assigned a contract in a country that does not pay income tax
- There is a suitable Double Tax Convention or Agreement (DTC or DTA) in place between the work country and where you are ordinarily resident. This will usually be the UK.
If you work abroad for less than six months and there is a DTA in force, you will pay your income tax back home. If you exceed this, tax must be paid in the country where you have been working.
In order for the DTA to apply the company you are working for must not have a permanent establishment (PE) created by having fixed place of business, nor should its centre of management have shifted to the work country. Furthermore, the costs of engaging you must not be paid by a business that does have a PE in the work country.
Where will I be liable for tax?
When contracting overseas you maybe unsure as to whether you remain a UK tax resident. If you stay out of the UK to work for a full tax year and are not in the UK for more than 183 days in that year, then you may become non-UK tax resident. In these cases, the income which you have earned whilst working abroad will not fall under the UK tax legislation's. If your contract is less than 183 days and you return to the UK within this limit, then you remain a UK tax resident.
Other factors to think about:
- You may need a visa and suitable vaccinations depending on where you are contracting.
- Social costs (which are the equivalent of NICs in the UK) are payable in the work country.
- Accommodation costs – are these covered as part of the contract?
Futurelink Group are here to offer a helping hand
We have an experienced team who can assist finding the right payment solution which is best suits you. Futurelink can accommodate those working in the Oil & gas, Energy, Engineering, Aerospace, and Construction sectors, although we deal in others. We would be more than happy to assist you with any advice on our products or answer any other questions you may have regarding contracting abroad.
You may be packing your bags sooner than you thought!
Please feel free to contact our help-desk team on 01923 277900 for more information or have a look at our page on payment solutions that would be suitable when contracting abroad.