US vs UK Payroll

Hi Helen.

My contract to work in the the UK (I am here on an inter-company transfer) has just been extended for another year.

I was told by my HR director that after working for 1 year in this country (ehich eill happen as of 1 October), I can no longer be paid from my US companies payroll and must move to the UK payroll.  Is this correct?

My long term intentions are still to return to the states, probably within 5 years, so it would seem to make sense for me to stay on the US payroll in order to keep paying social security and keep making 401k contributions.

Thanks for your help!

Moving to the UK payroll after a year must be a policy of your employer as generally you can stay in the US payroll as long as you wish. Most people choose to stay in the US payroll so that they can continue paying US Soc Sec tax (instead of UK National Insurance), provided that you have certificate of coverage, and contribute to the 401K plan, etc....

Helen

Helen,

Another question on this note.  I have moved over as a local to the UK and will be on my company's UK payroll.  As a UK/US citizen, I have the option of keeping US style benefits or having UK benefits.  At looking at the literature that I was given comparing the two, both seem to have the pros and cons.  Would it be more tax efficient for me to keep my US benefits or take UK benefits?   I have been told that I should basically take the benefits of the country I plan on retiring in, but as now, I don't know which one that will be.

Thanks.
bvamin

Perhaps it would be better to have a chat about this. Feel free to call me on 0208 466 9297.

Regards
Helen