Independent Contractor international payment

[SDent]

Hello all.
I have been living in the US for the past 5 years but in a couple of months am moving back to the UK.
I am going to continue to work for the company I have been working for here in the US, as an independent contractor back in the UK. We have negotiated a rate that I will be paid (in dollars) and formed a contract.

My question is this: What options do we have and which is the best options for payment??

Seems to me the options are:
1. Employer pays in to my US account. I make regular transfers over to my UK account. If I chose this option - how do I claim the correct income to the UK gov?

2. Employer pays direct in to a UK account - although my employer doesn't think this is viable since it opens them up to lots of international regulations.

3. Employer writes and sends US check to me in UK and I cash it in.

Any help gratefully received!

Sam

[Bevdeforges]

If you're an independent contractor, you should actually be sending your "employer" a bill for your services (each month, each quarter - however you want to do it). You're legally a separate company from your employer as a contractor and it's up to you to make periodic payments and declarations as required for taxes and social insurances in Britain.

You can set up your contract however you like as to whether and how you are paid - in US$ or in Sterling, by check or direct deposit. But it's up to you to keep your own books to track your revenue and expenses. One little complication I'm not sure about is that of VAT - you may have to charge your customer VAT even if they are located in the US, if you are doing the work for them in the UK. You may want to find a good accountant (CA) to help you set up your record keeping system.
Cheers,
Bev

[Minuvweyna]

I don't know if anyone else has run into this problem, but when I moved to the UK from the US I needed to transfer my savings from the US to the UK and get it changed into stirling. I was informed that a check would take anywhere from 6-8 weeks to clear.

I'm no expert on your question, but it's something to keep in mind regarding the idea of having your employer pay you by check, you could end up with a significant delay between being paid and actually having access to the funds.

Elizabeth

[Yaz]

You could always open up a $USD account in the UK with someone like HSBC Offshore so that you don't lose on the exchange rate when they pay you, then of you want to change money into sterling use one of the currency trading companies like UK Forex who give you pretty close to bank rate. You shouldn't have to charge VAT as they are not a UK registered company, at any rate I wouldn't register for initially. You don't have to do it till you turn over something like £65K. Alternatively, rather than run your own Ltd company you could go through one of the management companies in the UK. Use one that deals with overseas companies as they will have multiple currency accounts.