Reply With QuoteOdd. Why are they doing this? There are tax complications beyond your payroll stuff they would need to think about (depending on your role etc).Originally Posted by Des Parrot
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Anyone got any experience of this? My company is offering a net salary, I.e they pay all tax and other items such as NI & social security. This allows me to receive the same salary regardless of tax location.
Odd. Why are they doing this? There are tax complications beyond your payroll stuff they would need to think about (depending on your role etc).
I’m no tax lawyer but I can see problems with this if you receive payments and they don’t pay the tax and ni liabilities that you have! There’s no benefit to you, depending on your personal tax position, but there could be major liabilities. I’ll post again when I’m sober!
HMRC read these posts , please be careful .
I'm guessing that this relates to you working overseas (Poland if I recall?).
If income tax rates in Poland are lower than the UK then your employer will benefit from the difference. If rates are higher
They are saying you will be paid your salary net of the notional deductions as if you were paid in the UK.
Your employer then pays the relevant local taxes.
The main thing you should take care over would be the impact on pension contributions, i.e. you would not benefit from tax relief on contributions to a personal pension.
HMRC are involved. It’s all fully legal & managed by EY.
Under the scheme the my salary is increased to offset the loss of the company contribution.
Exactly this. Tax rate in Poland is 32% in UK 40%
The benefit to me is that my pension & NI remain in tack, paid in the UK and the company pay tax in Poland.
To explain further, from January I’m no longer classed as a UK resident but I’m still payrolled in UK. I have to pay tax in Poland but need to continue my pension & NI contributions in Uk.
Des why don't you just buy out Vinnie and the rest of us paupers will fall at your feet and cover the difference in what you owe HMRC.
can you set up as a LTD company des and get an accountant to sort it out if your on a contact ?
Thank god for that, its not like EY would ever **** anything up
Finally we have a use for Feedback and he is nowhere to be seen.
Let me summon him, 'Thatcher selling council houses reduced the overall housing stock'.
That will cover you for the Company scheme, but not if you make additional contributions to a personal pension.
Thanks for the vote of confidence Harry, its a great thought and I’d love to do it but I’m a few decimal places & noughts short at the moment.
Is this something that your firm proactively offered to you? Or that you asked for?
Are they moving functions to Poland and offering this as an incentive for people to move to Poland? Or are they saying you can live anywhere you want and your payroll will make sure that you receive the net pay you'd get if you stayed in the UK? If the former- makes sense and yes I've seen that quite a bit. If the latter- that's bonkers. It's manageable, but commercially I don't get why they would do it.
From January 1st I become a non-uk tax payer and will receive a P85. I will have all of the legal documentation to live & work in Poland. For the last year I’ve been on temporary documentation.
I will still be payrolled in UK and seconded to the Polish company. This allows me to protect my pension and national insurance.
The company already do this for the European MD and they’re following the same model. I can’t see any negatives, in fact only positives, especially as the zloty has weakened by 20% against gbp. Hence the reason I’ve posted here in case I’m overlooking anything.
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