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bigduckontax
bigduckontax, Accountant
Category: Tax
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Hello, I am Irish National currently studying in Czech republic.

Customer Question

Hello,

I am Irish National currently studying in Czech republic. I am earning money Online through a website I created. The money is Coming into Czech Bank account. I am planning to move to UK after graduating this year. I want to know If i have to pay TAX on my income from online? Also, when I move to Uk and keep my czech bank account, do i need to pay the UK Tax rate if i transfer money from Czech bank to UK Bank? Or I can continue paying czech taxes?

Thank you
Submitted: 2 years ago.
Category: Tax
Expert:  bigduckontax replied 2 years ago.
Hello, I'm Keith and happy to help you with your question.

The transfer of moneys from your Czech to your UK bank account is outside the cope of UK taxation. You should warn your UK bank of the transfer before it takes place in the event of a possible money laundering enquiry by the authorities.

You will need to pay UK taxation on your web income. On arrival the tax year of arrival will be split and the Czech part subject to Czech taxation and the UK part to UK taxation. There is a Double Taxation Treaty between the two countries to prevent the same income being taxed twice.

If you come to work in the UK as self employed you have to register as self-employed and pay HMRC your tax and National Insurance yourself each year. You can do this on line, see 'Register for HMRC Taxes,' a web site which explains the procedure and will guide you through the process. You will have an annual Personal Allowance which makes the first 10K of your net profit tax free.

I do hope I have thrown some light on your possible position. If your affairs are complex, however, it may well be necessary to retain a trusted, local accountant to negotiate on your behalf.
Customer: replied 2 years ago.

Hello,


 


Thank you for your reply. What If i stay in Uk and the money comes in the Czech bank and i dont use this money. I will keep paying Czech tax on it for next 3 years. Will i have to pay tax on it when i transfer it to UK after 3 years?


 


Thanks.

Expert:  bigduckontax replied 2 years ago.
I am not an expert in Czech taxation. This is an UK taxation advice site. However Euraxcess web site tells me that:

'Personal income tax is paid by employees
and small businesses or so called self-employers.
The personal income tax rate is a flat rate of 15%.
Employers are obliged to deduct tax advances under
a payroll deduction scheme. Self-employers pay tax
advances by themselves and file an income tax return
every year to settle any differences between the
amount due and amount advanced. It is possible
to claim a tax exemption for a dependent child,
dependent spouse etc. A joint tax return of married couple is not
possible in the Czech Republic since 2008.'

So your Czech income will be taxed, but the tax paid will be allowable as a tax credit against any UK tax liability assessed on your income through the medium of the Double Taxation Treaty I mentioned in my earlier answer.

There is no UK taxation levied on a transfer of moneys between your Czech bank account and your UK ditto. Once the funds are in the UK, if they are in an interest earning bank account then the interest element only will be liable to UK taxation.

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