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  • Tax question – working abroad
  • trail_rat
    Free Member

    after a quick pub conversation the other night im looking into this a bit

    I did 130 days working in west africa last year i believe paying local taxes.

    according to the boys at work i should be putting in for a tax rebate as they are in the processes of doing – alot of them have been doing this job for a fair while.

    when it comes to inland revenue ive always worked on the pretence of as long as they not looking for money ill let it lie. but apparently its worth it as itll be a sizable chunk over 130 days.

    anyone been in a similar position – id ask the guys but ive a fair idea its called Bull squit

    Zedsdead
    Free Member

    If you work outside the UK for more than 180 days then you don’t pay UK tax.

    Not sure about any other loopholes but would be interested to find out…

    donsimon
    Free Member

    Unless it’s changed there was a required amount of time that you spent outside the UK. Let’s say the threshold is 180 days and you only worked 130 days, go on holiday (abroad) for the other 50, if that’s whaty you want to do.

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    trail_rat
    Free Member

    to be fair they were pretty drunk – that was my jist o the rules as well – boss man says he will send out an email once he gets his back…..

    all i know is that me and the other 2 trainees did the most days out there so we shall see what happens i guess

    it was last year i did the work so going to the alps for 50 days isnt an option 😉

    konabunny
    Free Member

    I did 130 days working in west africa last year i believe paying local taxes.

    Did you pay any UK tax?

    I’d be surprised if you ended up being non-UK tax resident esp if you’re flying in and out: http://www.hmrc.gov.uk/cnr/faqs_general.htm#3nr

    But I may be very wrong…

    TheFlyingOx
    Full Member

    I was under the impression that if you pay local taxes then HMRC can’t then tax you on what’s left. Just prove to HMRC you’ve paid the local taxes.

    Thought that was how all the “tax-free” jobs out there and in the Caspian worked it.

    I could be drastically wrong though 😀

    trail_rat
    Free Member

    i think there is some confusion with the double taxation treaties – of which the country i was working in is not a signed in member of …

    but in effect ive paid a high % of tax in Equatorial Guinea and then paid up to higher rate in the uk also due to payroll being in the uk – anyone in EG for more than 3 months (periods away of less than 30 days out of country are not counted) pays EG taxes on income earnt there. i did about 7 weeks there , 12 days home , 4 weeks , 12 days home , 6 weeks

    think what my boss is trying to say to claim back is the tax i paid in EG ….. I dont understand how hes planning this one but its his call – he can do the leg work for us all – there are about 15 of us in the same boat.

    at the end of the day long as they dont ask for more money its worth a punt if he is successful.

    konabunny
    Free Member

    I would have thought they were talking about reducing your UK tax bill by the amount already paid to the Equatoguinean taxman but if they’re saying you might be able to get a refund from them…

    Nothing to do with this, which seems to be mentioning some sort of relief in the absence of a DTT, is it? http://www.hmrc.gov.uk/manuals/dtmanual/dt6601.htm (I don’t really understand it).

    I was under the impression that if you pay local taxes then HMRC can’t then tax you on what’s left. Just prove to HMRC you’ve paid the local taxes.

    Depends on whether you paid tax in the other country, whether you’re UK tax resident, and whether a double taxation treaty exists between the two countries. (And probably a heap of other things).

    trail_rat
    Free Member

    yeah which is where i think my boss/we will fall down as some iphone research at the pub (i wasnt drinking) lead me to see no double taxation treaty in existance – wasnt worth trying to argue with him as hes a lary drunk haha

    turboferret
    Full Member

    Unless the laws have changed significantly recently, to be non-resident for UK tax, you need to do a full tax year out of the country. Obviously this isn’t applicable, so you’re into the double taxation and reciprocal tax agreements between countries.

    If EG doesn’t have an agreement, then I think you’re a bit stuffed unfortunately.

    However, I’m not really qualified to comment, although I have been working abroad for the majority of the past 7 years, I’ve recently been on equalised tax agreements, where I don’t need to worry – the company pays whatever tax is required in whichever country I happen to be in, and I get a guaranteed amount net regardless.

    Sorry not to have any definitive answer.

    Hope you get it all sorted, surely the accountants your company use will know this?

    What did your contract say regarding tax?

    Cheers, Rich

    creamegg
    Free Member

    I dont have any experience of working somewhere with a local tax so the double taxation thing is not something I know about.
    Other than that my understanding is:

    You cannot be tax free if you spend more than 180 days in the UK in any financial year. Thats the first hurdle.
    Then you need to be out of the country for a full financial year with a maximum number of days spent in the UK of 90 days per year over an average of four years (from that point onwards).
    That last statement may seem to contradict with the first one of 180 days, and many people get confused by it and it is hard to explain.

    For example:
    I left the UK in September 2010, with approx days up to that date of 150 spent in the UK. Something called a ‘split year’ is then applied to my sutuation as I can still spend more than 30 days in the UK before end of the financial year, as long as it dosent exceed the 90 days per year over an average of 4 years. So for me to stay tax free I cannot exceed the limit of 90 days per year and must do that until April 2012. If I return before April 2012 I will have a heartbreaking tax bill for all my earnings so far. If I stay within those limits until after April 2012 I can come back to UK and not have to pay any taxes and continue working normally. Also, may not apply to your situation but for teh first 12 months after leaving the Uk you have to continue paying NI. After that its voluntary.
    Hope that helps. I can send you a HRMC document with full details if you email me.

    trail_rat
    Free Member

    my contract at the moment isnt worth the paper its written on as far as working abroad is concerned …. im on a graduate contract that states i shouldnt be getting paid for being abroad period …..

    it also didnt mention going to west africa and having guns pointed at me – so i dug my heels in and said i wasnt going to west africa for free – so as i say im not really all that bothered about the whole tax thing – i won on the wage front anyway – It was just a conversation thing that came up – and im pretty sure we will get nowt due to no treaty – but it would have been a considerable sum so i thought id throw it out the font of all knowledge.

    lucky i did good out there and my boss was impressed that hes paying me to be away no bother now.

    contracts up for renewal in october

    turboferret
    Full Member

    I wouldn’t go abroad without a specific contract if I were you, could be on rather shaky ground on numerous fronts. It’s always nice to have everything clear in writing in case things get messy, even if you do have a very good relationship with your boss.

    Eliminates things like getting double taxed for starters!

    Feel free to email me if you would like to see a model of one of my ex-pat agreements.

    Of course for short trips like yours it’s not so important, but might be helpful in the future.

    Cheers, Rich

    Woody
    Free Member

    There will be no shortage of accountants in Aberdeen who have specialist knowledge in this area.

    Might be worth a ‘consultation’ with one of them, especially if it is likely to be a regular thing.

    allthepies
    Free Member

    <wrong thread>

    turboferret
    Full Member

    Wino thread is ^ 🙂

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