where does he pay tax?

trailingspouse

My OH has just landed a 10-month contract - he'll be working in India for a German company and being paid in Euros. We run our own limited company and he is a UK citizen.
Is anyone able to tell me where the tax liability lies? I know that if the contract was for less than 183 days (about 6 months) he would be taxed in the UK, but I'm struggling to find authoritative and up-to-date info on the situation for longer contracts.
Many thanks.

chrismac1

http://www.hm-treasury.gov.uk/consult_statutory_residence_test.htm

From 6 April 2013 there is a statutory resdience test in the UK. This is bringing the UK into line with the majority of the G30, so India probably already has such a test.

You need to work your way through the test. My guess is he either qualifies under Part A for conclusive non-residence, or ends up being a UK tax resident becuase his presence - or days of work in the UK - are too high.

Note that presence includes flight days, and days of work includes working from home - two little traps.

chrismac1

Note also that because of 2 things:

1. The UK tax year runs April to March, but the rest of the world is normally Jan to Dec.

2. Other countries can have different tests.

Then even if he is tax resident in the UK, it is possible he is also resident in India too for tax purposes. So you need to run through the Indian tests too.