Uk Company Have Terminated My Permanent Employment!

[trevorg]

Just looking for some advice please!

Facts:

Employed as a Permanent Employee (project engineer/ design manager - communication systems, design and installers) in the UK for 'small' company (60 permanent up to 150 on short term agency contract- depending on workload).

Employed from June 2004 til now

Relocated to Thailand (my choice) April 2009 with a verbal agreement to 'test the waters', returned in June 09 for 3 weeks, was requested to stay longer and did (6 weeks). I have been paying PAYE and NI (as well as the company) as if I was still in the UK for the past year.

I have had my 'permanent' employment terminated, but they wish to continue employing me as a consultant.

I know I am able to declare to the UK tax office, that I am no longer a resident for UK tax purposes.

But how am I able to invoice my old company without them getting into 'tax' trouble!

I assume that i need to set up an offshore company, with an offshore bank account!

Any ideas or recommendations, and if you can't 'publish' them on here, PM me!

Thank you in advance!

[hansnl]

Had a similar problem in Holland with my former employer.

Was pensioned off and rehired for projects during 2006 and 2007

If you are not a resident in the UK any more, as I am not in Holland, you might be free of UK taxes, as I am from Dutch taxes.

If you invoice your former company it depends where you actually worked for them.

If in Thailand, and invoice them for the work, no VAT (maybe income tax in TH)

If in the UK, there must be an invoice with VAT

So, up to you

Edited April 6, 2010 by hansnl

[roiethome]

You can set up limited company in Singapore for couple of thousand dollars and then take advantage of generous tax free start up benefits, then bill using this company

[GuestHouse]

If your employer has terminated your full time employment what guarantee do you have that they are going to give you any consultancy work?

Sounds to me like you've set yourself up by sending the message you'll put up with anything they throw at you so long as you can stay in Thailand.

Grow some balls and deal with the 'Dismissal/Redundancy' issue or at least bargain for a full expat staff deal.

[trevorg]

Thanks for the responses so far. I probably didn't make it clear, my company has no business in Thailand or anywhere except for the UK. I moved to Thailand for personal reasons. I produce design documentation and assist with tenders and that sort of thing.

As far as guarantees of work and rates, then that is what I will be negotiating with them.

As I am overseas, a contract deal would probably be beneficial finacially for both parties.

Dealing with the Dismissal/ redundancy issue, I would probably be 'cutting off my nose to spite my face'.

I will look intothe 'Singapore' option!

Thanks again.

[tlongdon]

I must be missing something here.

You can choose to live wherever you like. You only ever (usually) have to pay tax in the country you earn it, or wherever you are permanently, and officially, resident.

If you continue to live in Thailand, so long as you leave every 28 days or whatever it is now, with extensions etc., you can continue to come and go for as long as you possibly want.

If you work outside of Thailand, you send an invoice in whatever headed paper you choose to design for your made-up company. If your UK company has an official policy only to work with you if you have a registered company, that's another issue but you can open a UK Ltd company for a tiny amount of money, and keep it dormant. Or you pay yourself the full profit of your company, so it doesn't make a profit, and simply file your company accounts with Companies House online every year. Then, since you don't live in the UK and aren't resident of anywhere, you get paid in gross. I recommend, if you're passing Switzerland, to drop into a small town somewhere and open an account to be paid into. I can recommend BCV.

Alternatively, if you want to do things "by the book", you can register yourself through a so-called "umbrella company". One I can thoroughly recommend and have been using for two years, is called Access Financial. You can google them. You can be considered an "employee" of theirs, and they will take care of billing your client, chasing up payment (that's worth its weight in gold), but there is a 5% fee involved of total billable fees (i.e. not expenses). I have to use this type of company for work I do in France, as I'm in the country more than 180 days and therefore liable for tax.

But for the remainder of the time (and for the best part of the last 10 years), I've been living in Thailand enjoying the good life, going overseas to work, getting paid overseas, and returning to live my life in Thailand.

I know it's too late to say "to cut it short", but either create your own UK company, and even make it dormant if you want, and bill your UK client through that. Or, go to some organisation like Access Financial who will work as your employer, and who I believe earn their 5% (which happens to also be very competitive). To do the singapore thing was a tiny bit of a pain - I forget the details now, but I had looked into it. The bottom line was, as a UK national, I felt more comfortable opening a UK registered Lts company - which I did quickly and easily through http://www.company-wizard.co.uk/

Anyway, whatever you choose to do, at least the first step is the best one - choosing Thailand to live in! It rocks. Since I arrived in 2000, I've worked in numerous other countries, and BKK is always the city I want to get back to. Trouble is finding decently paid work in the land of smiles...

Good luck.

Thanks for the responses so far. I probably didn't make it clear, my company has no business in Thailand or anywhere except for the UK. I moved to Thailand for personal reasons. I produce design documentation and assist with tenders and that sort of thing.

As far as guarantees of work and rates, then that is what I will be negotiating with them.

As I am overseas, a contract deal would probably be beneficial finacially for both parties.

Dealing with the Dismissal/ redundancy issue, I would probably be 'cutting off my nose to spite my face'.

I will look intothe 'Singapore' option!

Thanks again.

[manarak]

I'm almost sure you don't even need a company.

For what? You won't pay any taxes in Thailand if the work is done "abroad" and if the money stays "abroad" for at least a year.

I think you can even maintain your account in the UK. Since you will be resident in Thailand, you won't be taxable in UK (people correct me if I'm wrong).

Just invoice them privately as a freelancer living in Thailand, with instructions to pay on a UK account, without VAT.

That's what I would do.

But it might not be good advice since I don't know UK law.

[RAZZELL]

If you follow some of the advice given in the above...just wait for a nasty visit from the UK tax man a few years down the line

Let alone no WP, no tax paid in Thailand

RAZZ

Edited April 7, 2010 by RAZZELL

[moobie]

Firstly, if you are due any redundancy money then bloody well claim it....business is business and you may not get the consultancy work you expect.

Secondly, this document has replaced the HMRC's guidance on IR20 : Taxing stuff

look at page 50 for a suggestion regarding if and where you will be taxed, etc.

The HRMC won a big case earlier this year on "non-dom's", copy and paste the following into The Daily Telegraph website for an indication - Robert Gaines-Cooper

The fact that you are living in another country may not make you a non-dom if you have any financial/taxable links left in the UK.

Good Luck.

[jay1980]

I am an independent IT consultant, working through my own Uk Ltd company.

I have an accountant that costs me £75 + vat a month. I send and invoice to the client. I enter all my taxable expenses in an online portal, and the payment is made to my business account from the client.

The accountant helps to minimise my UK tax. I transfer money from UK business to UK personal account as per the accountants instructions. This can all be done online.

It only cost about £200 to set up my company when I started working like this.

The nature of my work means I have to be based close to the IT data-centre (so far have only worked in UK sites) so not sure if there would be any other factors if I was able to do my work online in Thailand, but I can recommend the accountants I use. The online way they work may suit your needs. PM me for more details if you wish.

cheers

[jay1980]

double post

Edited April 7, 2010 by jay1980

[trevorg]

Thanks again for the advice/ information, all very useful! Especially HMRC6.

[tlongdon]

so long as you've completed your P85 and don't spend more than 183 days there, and don't conduct work on British soil, HMRC is happy never to hear from you again until you return.

It's a good idea to continue paying voluntary NI contributions though, which you can do on a yearly basis as a lump sum. This is for your retirement benefit, or if you need to return to the UK and claim incapacity benefits or whatever in the future.