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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
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Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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I'm considering an offer on a position in Russia, but

Resolved Question:

Hi
I'm considering an offer on a position in Russia, but have a question regarding the Tax implications here in the UK. The job would only be part-time working up to 3 weeks on and then returning to the UK for 4-5 weeks each time through the year, where I would also do casual work as a UK employee subject to the regular UK Tax and NI, but not for the same company.
My employer will pay the Tax in Russia, would I have to also pay some UK Tax on these earnings ?
Thanks in advance.
John
Submitted: 2 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 2 years ago.
Hello and welcome to the site. Thank you for your question.

As a UK resident for UK tax purposes, you are taxed on your worldwide income and gains arising in the tax year.

You say your earnings in Russia would be taxed at source in that country.

You will need to file supplementary pages SA106 - Foreign to cover foreign income and tax suffered on that income. You would claim Foreign Tax Credit Relief against UK tax on that foreign income. Earnings from the same income stream are taxed once only under double taxation treaty/agreement between countries.

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 2 years ago.

Thanks for the swift response, sorry for my naivety in these matters! So for example if I am being taxed at source at say 13% I would still be liable to pay UK tax or would the double tax treaty agreement kick in so to speak? I did read up on this but do not fully understand.

Thanks

Expert:  taxadvisor.uk replied 2 years ago.

John, thank you for your reply.

As you are aware, the basic rate tax in the UK is 20% and provided your total income from all sources remains below the threshold for higher rate tax, the income from Riussia would also be taxed at 20%.

You would claim the tax suffered in Russia on that income as FTCR.
So in effect, you would pay additional 7% tax on that foreign income as you would have already paid 13% to the Russian tax authorities.

I hope this is helpful and answers your question.

Customer: replied 2 years ago.

I have also just read that if I was being taxed as a non resident in Russia the Tax is 30% which would only be liable for Tax at source, is that correct?

Thanks.

Expert:  taxadvisor.uk replied 2 years ago.
John, thank you for your reply.

I am an expert covering UK tax and don't have expertise on taxation in Russia.

Here is a link to KPMG site covering incoem tax in Russia.

http://www.kpmg.com/global/en/issuesandinsights/articlespublications/taxation-international-executives/russia/pages/income-tax.aspx


There is a lower tax rate of 13% and it applies to individuals employed under a "highly qualified specialist" regime. Otherwise, the tax rate is 30% for non residents.

If your earnings were taxed at 30% there there would ne no more tax payable to the UK authorities.

I hope this is helpful.
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4882
Experience: FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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