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Discussion Starter #1
Hi all,

I am being let go from my current position in a few weeks and I have been approached by a UK recruiter with regard to contracting in one of my specialist areas for a UK financial organisation for 4 to 6 months.

Part of the work would be in the UK and other parts would be in other countries they work in around the globe. I'm hoping this, along with the work being split over 2 tax years, will help me not fall foul of SRT.

I suspect I should seek some proper tax advice, but I thought I would first turn to this forum. I'm hoping that someone might have some experience as a UK national contracting from Dubai back into the UK.

What I'd like to find out is:

While I understand that I will have to pay UK income tax on work done in the UK. Can you tell me if I would have to pay national insurance too?

When paying income tax on work done in the UK, would I still be entitled to the £10K tax-free allowance? Do the normal tax bands apply?

I'm thinking of setting-up a UAE company for this contracting role (as this would have the advantage of giving me a residence visa). Are there any suggestions of a better place to create the company? Or any other advice with regard to the company and/or under which laws the contract should be drawn up (though I suspect I won't get a choice in the later point)?

Can you think of any "gotchas" around this situation/contract?

Many thanks in advance for any help/advice you may be able to give.

/Chestnut
 

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Hi Chestnut,

Residency is a very complex area and now involves the statutory residence test (SRT).

Your individual circumstances would need to be looked at in much more detail as ties such as home, work, family etc. in the UK may class you as UK resident for tax purposes regardless of where you reside.

If classed as UK resident you would then be taxed on your worldwide income so it is very important that your individual circumstances are dealt with correctly to protect your residency status and exposure to UK taxation.
 
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