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TonyTax, Tax Consultant
Category: Tax
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Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I am Dutch national who is employed in the Middle East (countries

Resolved Question:

I am Dutch national who is employed in the Middle East (countries like Afghanistan,Syria and Lebanon). Due to the recent turmoil there I started to work from home in the UK. My wife is British and we live with our 2 children in the UK. Until a few months ago I was resident in Iraqi Kurdistan.
Whether this new situation is permanent or temporary is hard to say.
My question now is what do I have to do in terms of registration and will there be any tax implications although I am not employed by a UK based company.
Submitted: 1 year ago.
Category: Tax
Expert:  TonyTax replied 1 year ago.
Hi. Can you confirm that whilst you have been working abroad you have been treated as non-UK resident for UK tax purposes and haven't paid UK tax on your foreign earnings. When did you first start working abroad?
Customer: replied 1 year ago.
Hi,I am working abroad already for 20 years and I am still not resident in the UK. My last residence was Kurdistan Iraq.
Never paid tax on earnings because I never worked or lived in the UK
Expert:  TonyTax replied 1 year ago.
Thanks. Leave this with me while I draft my answer. It will take a while so please bear with me.
Customer: replied 1 year ago.
Expert:  TonyTax replied 1 year ago.
Hi. At the time of the Libya troubles when Gaddafi was removed from power, there was talk of those fleeing war zones who had been treated as non-UK resident being given tax relief on the basis that they were forced to return to the UK though circumstances beyond their control. I'm not sure that anything came of that but you might call HMRC on the number here and ask to get a call back from the specialist section which deals with non-UK residents. You should qualify for split-year treatment so that your foreign earnings up to the time of your return to the UK will not be taxed in the UK. Look here and here for more information on the statutory residence test and here for a flowchart. Assuming that you have to pay UK tax on your earnings since your return to the UK and I believe that you will, as your employer has no presence in the UK you will need to register with HMRC to operate PAYE and NIC on your own earnings. Take a look at the notes here and then call the number here to explain your situation and you will be guided through setting up your own PAYE and NIC function. I've known a few people who, instead of setting up their own PAYE scheme, register for self-assessment and pay their tax through that instead of on a monthly basis through a PAYE scheme. The problem with this is that self-assessment does not deal with the liability to employee national insurance contributions. You will probably be better advised to go through the process described in the previous paragraph. I hope this helps but let me know if you have any further questions.
Expert:  TonyTax replied 1 year ago.
If you are non-UK domiciled, you might choose to pay UK tax on the remittance basis which means that you only pay UK tax on UK source income and on foreign income you bring into the UK. Take a look at sections 5and 9 of RDR1 here for more information. However, I suspect that HMRC will say that as you are working from within the UK, those foreign earnings will be taxable in the UK.
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