Employed in the UK by Australian employer

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Employed in the UK by Australian employer


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Old 26th January 2009, 03:32 AM
 
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Question Employed in the UK by Australian employer

Hi all, I have a pretty strange situation going on and am looking for any advice that can be offered.
I am UK citizen, currently living and working in the US, for an Australian employer.
Currently my employer has a business friend in the US pay my salary through their company so that taxes are taken care of etc.
My company offers worldwide support, and the job I perform can be pretty much done "working from home". I have previously discussed with my employer moving my job back home to the UK.
Opening up more services for their UK clients and allowing me to move back home.
My problem is trying to work out a solution for how my company can continue to pay my salary and also pay the required UK taxes. Is there anyone currently living in the UK who is paid by an Australian company?
Would it be more beneficial for me to work "self employed"?

Any thoughts suggestions offered would be greatly appreciated.
Thanks.

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Old 26th January 2009, 06:45 AM
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Hi and welcome to the forum.

I'm no expert on UK taxes, but the usual approach to this is that, if the "employer" has no presence in the country in which you are going to be working (and resident), you pretty much have to become self-employed (or probably better put, "a contractor"). In essence you set up your own company, and your "employer" becomes your "customer."

That puts you on the hook for all the taxes and social insurances, as well as day to day expenses and paperwork of the business. Rule of thumb (in the US anyhow) used to be that you needed to bill about twice your gross salary to stay even, but that will be somewhat different in the UK, depending on your social insurances and whatever the VAT situation is. (In some countries, you have to bill VAT even to foreign clients, if the service is being performed in the country.)

Don't forget to figure in all your additional expenses - telephone lines, computers and other equipment (buying and depreciating), office services and supplies you may need, including possibly an accountant to help you with the record keeping. That's all deductible for your taxes and part of your "employer's" expenses.
Cheers,
Bev

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