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Topic: UK citizen, living in the UK, working for US company - taxes???  (Read 5694 times)

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UK citizen, living in the UK, working for US company - taxes???
« on: September 29, 2008, 06:16:36 PM »
Hi,
I am working for a US company.
I live and work out of the UK and the only time I will enter the US is for a couple of days a year, for a business meeting.
I am paid through the US company. 
How do i pay taxes?
Is th US company supposed to deduct taxes for me for the US?  But, since I do not have a US Social Security number, how does this work?
Thanks


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Re: UK citizen, living in the UK, working for US company - taxes???
« Reply #1 on: September 29, 2008, 07:13:56 PM »
From the UK side, you are going to need to contact your local tax office.  You are certainly going to have to inform HMRC and you will have to complete self assessment tax forms at the end of the financial year.  You need to make sure that you are paying National Insurance, and if you are being paid into a UK acocunt you will almost certainly be subject to UK income tax.

Vicky


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Re: UK citizen, living in the UK, working for US company - taxes???
« Reply #2 on: September 29, 2008, 08:30:03 PM »
Thank you so much for your quick reply, Vicky.
So, in that case the US company will just pay me gross wages and I take care of the taxes here in the UK?



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Re: UK citizen, living in the UK, working for US company - taxes???
« Reply #3 on: September 29, 2008, 08:35:22 PM »
I would *guess* so, but HMRC are very helpful so call them.  It may be easier for you to register as self employed, and for them to pay you gross and you could then pay a slightly lower tax rate than if you were an employee.

Vicky


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Re: UK citizen, living in the UK, working for US company - taxes???
« Reply #4 on: October 05, 2008, 03:58:04 PM »
When I was working in the UK but being paid by the US, the US company still withheld the taxes as per my W2 deductions.  I then submitted my tax return just like normal (which you have to do even if you are earning in foreign money) but you can claim a foreign earned income credit (the first $85K is tax free) and you can also get credit for the taxes you pay the HMRC.

Also, there are some tax credits if you plan to only live in the UK for less then 2 years from the UK.

So if you can figure out what is going to be deducted and what your taxes are going to be like, you can increase your deductions so that they take less and less tax out.  For two years, I essentially paid < $1,000 in Federal and State taxes between mortgage interest credit and foreign earned income.

Getting professional tax advice in a dual US/UK tax accountant is probablly the best idea, because there is a lot of ins and outs that you should be aware of.
WARNING My thoughts and comments are entirely my own.  Especially when it comes to immigration and tax advice, I am not a professional.  My advice is to seek out professional advice.  Your mileage may vary!
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