Another Tax Question

Hi Helen-

I am in somewhat of a similar situation as the previous poster.  I worked for my US based employer until October 13th, when I started work here.  But in my case, I have still been getting paid from the parent comapny in the states and will be for the duration of my stay (Early April).  So, does the IRS need to know that I have been living here?  I still have a US based permanent address.

There is a chance that my stay will be extended, and that I may even end up here permanently.  Is is possible for me to keep getting paid from the states indefinitely, or must I begin to get paid from here at a certain point?  If I can do either, what do you recommend I do?

Also, any info you can give me on things like 401k's and pension plans would be appreciated, as I am concerned about making sure that I continue to contribute towards my retirement.

Thanks for your help!

Ed

Hi Ed

Aounds like your assignment which started in October was short-term (less than 6 months?). If this is the case you will be exempt from UK taxation under the US/UK tax treaty if you meet the following:

(1) You were in the UK for less than 183 days
(2) Your employer remained to be the US company
(3) All you expenses were borne (or re-charged) to the US employer.

Once/if your assignment get extended you can still be paid from the US payroll. In fact this might be a better option as you can benefit from the NOR releif in this case. Also, you can continue to pay towrards your FICA, Medicare and 401K.

The above, is a short answers to your questions. Please feel free to call me on 0208 466 9297 if you would like to discuss these further.

Helen