Norwegian 787 LGW commuters tax payment

[NineInchSnail]

Hello,

For those of you working in LGW for Norwegian and living in another country than UK, where do you pay your taxes? In the UK or in your residence place or in both? Thanks for the info

9"

[sarah737]

NIS-you have to read the double tax treaty between your country of residence and the UK to find the answer. There are many differencies between diiferent countries, so there is no simple answer.
Social security is due in the UK if you are based there. You will benefit from healthcare in your home country according the local rules and according the UK rules in the rest of world.

[Avenger]

I asked the same question on UK HMRC, whom were extremely helpful and the advice is FREE! they basically said the taxation is based on where the work is generated from. In other words, if my work were to be out of a UK base, ( and all NLH is) the tax and NI contributions would be payable under PAYE in the UK, that is " deducted at source". If I choose to live outside of the UK and the country of residence has a DTA agreement wit the UK, the " marginal" tax is collected or refunded according to the rate of tax in the country of residence. As the Uk has quite a high basic rate, it is unlikely I will be liable for any tax in say Holland. On the other hand, Dutch rules allow for claiming of tax relief of some training costs, bank loans, housing costs etc, butI would have to calm that back at the end of the tax year as the Uk authority do not give relief for tax credits in other countries.. in short, they want their pound of flesh and its up to me to sort out any refund in my country of residence. Forms are available on HMRC website for these claims and you must establish your 'TAX STATUS" in advance.

[hunterboy]

Mm... What is they say about free advice? I would suggest talking to the centre for non residents at HMRC. You may get an alternative opinion on your centre of life and taxation status. Better yet, pay and get some professional advice as getting it wrong could be extremely costly.

[Kirks gusset]

The guy I spoke to covered the residency issue as I would be living outside of the U.K. For more than 182 days a year and also meet the 90 day rules but.. Stated as I would be employed by a uk company they were duty bound to stop the tax at source. Always worth a second or third opinion though especially as the HMRC have been slated today in the press for their customer service support and advice I'm keen to avoid the issues others have encountered. Personally I wouldn't pay a tax consultant as the advice from the horses mouth is free in most cases and the advice from the horses ass usually costs! Lots of good advice on uk HMRC website about non residents

https://www.gov.uk/tax-uk-income-live-abroad/overview

[hunterboy]

Considering that they are not duty bound to stop the tax at source, it kind of negates the value of the rest of the advice.
Many of us that work for other UK based airlines ,but live abroad receive our salary GROSS, and pay our taxes where liable.

[CaptainProp]

Yes, but is that living AND working abroad while employed by a UK based company? This would be different from the guys being employed by UK airline, and based in the UK, but living abroad.

CP

[uchy]

for me it's really unclear about taxes. Briefly, if I pay the taxes on UK how much is subtracted from the gross salary?

[Avenger]

Hunterboy,

Can you please give an example of a UK based airline that pays gross when your duties start in UK? Thanks as I can't think of any

[The Crew]

NLH is not a uk based airline , you the contractor are?

Korean do home basings, pay gross but of course tax is an individual's affair.

Paying tax is ok if you live and enjoy your life in the uk. Paying it and not residing there is a different matter.

[Shanwick Shanwick]

Those above who contacted HMRC either asked the wrong questions or spoke to the wrong department as the advice is not entirely correct.

As previously stated, it's largely dependent upon the Double Taxation Agreement between the UK and your country of residence.

You need professional advice.

[Avenger]

HMRC Residency Double Taxation Guidance Note 8
Relief at source under Double Taxation treaties
This Guidance Note explains what to do when:

HM Revenue & Customs (HMRC) Residency accepts that treaty relief is available on income paid out of the UK
and issues a time limited Direction to that effect which then expires
but the income continues to be paid under the terms of the same contract
and the recipient of that income wants further payments to be made together with the benefit of Double Taxation (DT) relief.
Background

In some cases UK law requires tax to be deducted from payments made to a non-resident person. A non-resident who qualifies for relief from UK tax under the terms of a DT treaty can claim repayment of all or some of the tax that is deducted - depending on the terms of that treaty.

Note: " claim repayment" to me this means we pay and then claim it back! Its a mine field..

[hunterboy]

Avenger BA
Many of us non-residents are paid Gross and pay income tax in our country of residence.

[wiggy]

Its a mine field..

It is....initially at least you really do need professional advice from someone who is specialist in the field but in the meantime I'll chuck in my FWIW - this is how it appears to work for someone working out of a UK base for a UK airline but resident elsewhere in the EU in a country that has a Dual Taxation Agreement (DTA) with the UK.

1. NI paid in full in the UK.
2. Income paid Gross ( i.e. what hunterboy said, with the Health warning that may be the result of an arrangement between the airline and HMRC - No idea what Norwegian do).
3. Tax returns submitted to both the country of base and country of residence.
4. UK liability for tax calculated on amount of duty time spent in UK/UK airspace - HMRC send out a bill every year.
5. Country of residence also taxes income in accordance with it's own rules and also in accordance with the provisions of the DTA...so yes, a bill from them as well.

As is probably obvious from the above this involve a lot of book/record keeping and lots of form filling....but above all I'll emphasise the point others have made - you need professional advice.

[Avenger]

Thanks for the contributions, just one question to Shanwick : your post from 2006?

11th Jun 2006, 20:54

Each case is different and everyone is liable, in one way or another, to pay tax in the UK.
I suggest you contact an accountant such as Wilfred T Fry for specialist advice.
Fly3

As suggested I will get an accountant to look into this, thanks

[wiggy]

Good Luck

Without naming names...A hint that whilst IMHO you do need professional services to get started once you're settled in it's fairly easy if your tax situation is straightforward. You might then find out that still you end up doing the annual form filling and still get charged a lot of money for somebody putting a rubber stamp on a form you have completed....

[Shanwick Shanwick]

Avenger

You'll note that I didn't state put a figure to that level of UK taxation. There will always be "Some" liability in this case.

[wiggy]

With regard to some here commenting/perhaps being sceptical that you can be employed out of a UK base and be paid Gross (or thereabouts) ..this link might be of interest:

PAYE81545 - PAYE operation: international employments: UK employer's duties

Most specifically the comments about Section 690 (which explains the "NT 690" entry found on some payslips )

From the link:

The employee is resident / not ordinarily resident or not resident in the UK and works both in and outside the UK
The employer can apply under Section 690 ITEPA 2003 for a direction from HMRC to operate PAYE only on the percentage of the employee’s total earnings that are for work in the UK. This applies to all payments made by the employer including termination payments and share based remuneration. An application for a direction must be sent to Self Assessment, HM Revenue and Customs, BX9 1AS United Kingdom.

My emphasis of " employer can apply....."

Edit to add:

How it works, in short:

If the employer is registered they can deduct an estimated amount of Income tax due, through PAYE. The amount deducted is based on an estimate of your UK duty percentage for the year.
The employee submits an annual return to HMRC, along with details of achieved duty hours inside/outside UK.
HMRC will then calculate liability to UK Income Tax, and balance the books, either by issuing a tax demand or a refund.

[Direct Bondi]

Norwegian's "employer/employee" circumvention and all associated with it continues. The income tax obligations and any repercussions in connection with employment via an agency's broom cupboard in London, via a Scandinavian satellite office with Pacific Rim headquarters, will provide interesting future reading. Sadly for some, possibly an HMRC audit.
I suggest you retain all emails between yourself and your agency employer on the subject of withholding income tax and provide copies to HMRC if audited. An apportioned liability may lessen the penalty charges you may incur.

[Smokie]

'Kin night mare. I work for an airline through an agencey, both say I am responsible for my own tax. Problem is both are based in Europe not UK. My projects over the last couple of years have me operating out of several countries for months various, including a UK base. It is complicated to say the least, as all my expenses are not just in Euros but other currencies as well. 😟