Tax free income?

tricky_micky

I am currently working in Kuwait, I am registered as CIS in the UK (sole trader providing construction services)
I will be in the UK less than 90 days per tax year, I am employed by a UK based company and paid by them into a UK bank.
All my flights and accomodation is provided by the company, but I receive a daily Per Diem OF £50.00 during my stay in Kuwait.
I do not receive any retention payments whilst within the UK, and I do not provide any services (i.e. work) during my leave in the UK.
With the above information, am I eligable to be tax except from UK tax?
The duration of the project is from January 2008 to August 2009.

Merlin_Accounts

Hi Tricky Micky

As you are in effect out of the UK for the whole of the 2008/09 tax year your income in that period should not be subject to UK tax, but anything prior to that will be. As you are coming back pat way through a tax year you may find that all the income after 5 Apl 09 is also subject to UK tax.

The fact that you say you are working for a company does seem to suggest you may actually be an employee, not self employed (holding a CIS registration does not necessarily mean you are self employed).

This is a complex area of tax legislation!

tricky_micky

Merlin Accounts, thank you for your reply.

As regards the employment status, everyone works for someone! I am invoicing a UK company for the construction services I provide here in Kuwait.

Would my per diem be subject to UK tax?

Merlin_Accounts

The daily allowance you receive is still classed as income, but of course you will have expenses to claim against it no doubt (meals, drinks etc.).

The UK tax position on this is the same as my earlier post.

I'll not get into what the definition of an employee/self employed person is as you could write a novel :rolleyes: