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bigduckontax, Accountant
Category: Tax
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Hi! I am uk citizen resident in the UK. I have accepted a contract

Customer Question

Hi! I am uk citizen resident in the UK. I have accepted a contract to work for a South African company. I will work from home in the UK and get paid in pounds into my UK bank account. Obviously I will need to register for self assessment to pay tax and national insurance. Since this is a full time employment contract I don't believe I am considered "self employed" is this correct? If so will I still be able to take deductions? I have to pay for my own computer and internet access and I am using space for my office. I also have professional fees that I pay which I would like to deduct.

Kind Regards
Joseph Dunne
Submitted: 3 years ago.
Category: Tax
Expert:  bigduckontax replied 3 years ago.
Hello Joseph, I'm Keith and happy to help you with your question.

I would be inclined to register as self employed with HMRC if you are not already so registered. A South African (SA) organisation is unlikely to have exposure to the UK tax system. The acid test between employment and self employment status is control. So if it is shown that your employer has a certain degree of control over you, your work, what you do, etc then it is likely you will be deemed an employee rather than self employed. As the organisation you work with is located in SA I suggest that their level of control is severely limited. Remember that a contractor can be told what to do, but not how to do it. I submit that you are exactly in that position and can quite properly operate as self employed. You can then invoice for services and offset costs against profits earned.

You might consider registration for VAT, you have to anyway if your turnover exceeds 81K. However, your invoices to a SA company are zero rated supplies and your expenses incurred in the UK are almost certainly charged on to you standard rated so the net result will be an inward cash flow quarterly in your favour: just a passing thought.

I do hope I have helped you with your problem.
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Expert:  bigduckontax replied 3 years ago.
Thank you for your support.

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