How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask TonyTax Your Own Question
TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15916
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
13905389
Type Your Tax Question Here...
TonyTax is online now

I've been working mainly UK company years,

Resolved Question:

Hi. I've been working mainly for a UK company for 2 years, but I have clients in South Africa that I host websites for and do web development for. The company in the UK would like me to be based in London permanently now and they want to put me on PAYE. I will still have my clients in South Africa. Should I go on PAYE or can I argue the case that I should remain a contractor? The bulk of my income is from this UK company these days.
Submitted: 2 years ago.
Category: Tax
Expert:  TonyTax replied 2 years ago.
Hi.

Are you saying that you private clients in South Africa that are nothing to do with the UK company you appear to work for on a self-employed basis?
Customer: replied 2 years ago.

Yes that is correct. They are not connected in any way. The only thing is that the UK company really is the bulk of the income for me

Expert:  TonyTax replied 2 years ago.
Thanks.

Leave this with me while I draft my answer.
Expert:  TonyTax replied 2 years ago.
Hi again.

There really is no right or wrong answer to this. Given that the UK spurce income is the bulk of your income, you may not e in a position to walk away from the UK company if you don't want to work as an employee. You might have been able to that if the private work gave you enough income to live on alone.

The UK company may be getting worried about your status as a contractor because HMRC are making noises about the status of those like yourself who claim to be self-employed. If the company was the subject of a PAYE audit by HMRC, your status would almost certainly come up especially if there are other contractors.

Being on PAYE may preclude you from claiming tax relief for some expenses that you are currently able to claim but as long as you are allowed to continue providing a service to your private clients, you should try to negotiate as good a deal as possible with the UK company.

As I alluded to above, any company can dictate the terms under which you work for it. It's been the case in recent years that individuals such as yourself have been forced to set up their own limited companies to free the client company from PAYE obligations but as I said earlier, HMRC are conducting information gathering exercises to assess the cost in terms of loss of tax and national insurance contributions to the Treasury of one man companies with one end user client, presumably with a view to lobbying government to tighten up the rules. I know you are self-employed but the basic principle is the same.

If you want to remain as a contractor, then by all means try to do so but be careful not to burn your bridges.

I hope this helps but let me know if you have any further questions.
TonyTax and other Tax Specialists are ready to help you

Related Tax Questions