Possible move to Hong Kong

darren_uk

I have been offered a secondment/job change from UK to Hong Kong, and may do this for 12 months. If I do undertake, I will hope to gain from a 16% income tax in HK instead of 40% in UK, as I assume I will be paid in HK Dollars. What, if any, tax implications or penalties do I face having to transfer mortgage and other utility payments from HK to UK? My family will stay in UK hence I still need to pay all the bills. Any insight, benefits and pitfalls, into these matters would be welcome.

nickmoul

Exchange Rate Fluctuations could make a big difference to the cost of your UK liabilities. Get it agreed in writing with your employer that you will be paid your agreed salary in HK$ or Sterling. Then plan accordingly. Also, if possible, get it agreed that your employer pays your accommodation costs as there are favourable tax breaks in HK for that. If you have a partner, take advice as whether he/she could either assist you in your job or have his/her own job.

Ensure UK NI is being paid by you employer whilst you are away.

HK is a great place, but accommodation is probably better on Kowloon side, its less cramped. Do not agree to any accommodation with out seeing it first. Your employer should give you up to a month to sort out accommodation
after arrival and before you start work. Ensure the package includes moving costs, accommodation deposits etc. Ensure you take lots of photo's of you for various permits etc.

Ensure your work permit is in place before you leave UK, it can take months to get it and its illegal to work without a permit.

Get a gmail email account and start using it so your friends can keep in touch. Similar with Flickr for photo's saves on large emails.

Best of luck, hope this helps. :~)

BoGoF

Bear in mind also that you will have to be out the UK for a complete tax year before you will be regarded as Non Resident for income tax purposes. So if you leave now you cannot return until after 5 April 2010. Uf you do you will be taxable on your worldwide income although you would get credit for any foreign tax paid.

Cook_County

I hate to disappoint you but you will remain UK resident & taxable in full on your HK earnings.


You will also have to pay housing costs in HK. Will the company pay? Will they protect or equalise you?

The_Tax_Man

Not only do you need to be outside the UK for a full tax year but your employment must last for that full tax year as well. I suggest you google 'IR20' for a full guide to expat taxation from a UK point of view.

If you do break residence there are no tax implications (in the UK at least) of sending money back home.

darren_uk

Firstly, thanks for all comments.

So basically if I do go ahead, I need to do it from April 5th 2009 until April 5th 2010 to gain the tax break. That opens up a bag of worms, should have done it this yr!!

I will have to check out IR20 and talk it over with my employer.

Info on HK, thanks, I used to live there when I was a kid and for the past 2.5yrs have been in and out of HK and other Asia Pacific countries, was actually there yesterday but now in Beijing for a week.

Accommodation; they used to pay expat housing, not so sure now, but agreed can be expensive.