Brit abroad tax implications

sunshine_lass

I have been living in New Zealand for just over a year, working full time and paying tax here. My visa here only allows me to work for one employer. As a result, there have been a couple of instances where I have done freelance work for NZ companies (very small amounts of money) and got them to pay into my English account. So my first question, should I be declaring this and do I need to pay tax on it?

The second question is if I do freelance work from NZ for a UK company what is the best way to go about this? Pay into UK or NZ account, declare or not? Register as self employed?

Thanks

pjclar02

Hello there

It depends on when you left the UK and how long you will be out of the UK for. If you have been living in New Zealand for over a year, then it is likely that you will be treated as non-resident in the UK for tax purposes. If you are treated as non-resident in the UK for tax purposes, then only income that is earned in the UK will be liable to UK tax, regardless of whether the income is deposited into a UK or New Zealand bank account.

So to answer your first question, the freelance work that you are undertaking in New Zealand would not have to be declared in the UK and you would not need to pay UK tax. You would need to speak to a New Zealand tax advisor about your obligations in New Zealand.

Similarly for the second question, even if you are undertaking work for a UK company, provided you are not resident in the UK you would not need to register as self-employed in the UK or declare the income on a UK tax return. Again, you would need to check your obligations in New Zealand for declaring this.

If you want to post the date you left the UK, when you intend to return and any details of days you have spent back in the UK since leaving, I can determine your residency status for tax purposes.

I hope this helps.

Best wishes

Paul

sunshine_lass

Thanks Paul, that was really useful. I left the UK in July 2010 and as yet am unsure of my plans. My visa currently expires Dec 2012. I have been back to the Uk but only for a 3 week holiday. Any more advice would be great. Cheers

pjclar02

Hi there

Thanks for posting the additional information. I can confirm that you will not be treated as tax resident in the UK, and therefore you do not need to declare the income in the UK, register in the UK or pay UK tax (provided all of the work is carried out in New Zealand.

On a separate issue, did you complete a P85 when you left the UK? If you were working and paying tax between April 2010 and July 2010, then you may be due a tax refund if you have not already claimed one.

Best wishes

Paul

Blanco74_2

Hello, I have been living in Slovakia for 3 years now, and 99 percent intend to stay here for good, I pay 2O percent tax here the same as UK. Up until now I haven't given much thought about whether or not I should pay any tax or IE to the UK, and whether or not I should inform the ILR of my situation. Or just keep keep quiet and carry on living my life here as normal, after all I am a UK citizen just living in Euro land.