Still_Searching

Help! In the process of getting a temporary transfer with my company to Australia (for 3 full years). I will be working in Australia, paying taxes there, however just found that I have to pay 11% of my earnings (including benefits) back to the UK government in Class 1 NI for the first year. Apparently I can't opt out and I can't afford to go if this is true. :curse:Thank you.

cookiestar

I thought if you declared yourself non-resident of the UK for tax purposes, you weren't obliged to pay NI, but could choose to continue to pay your stamp if you wanted. Give the IR a call and have a chat with them.

cookiestar

Also, have a read of this: http://www.hmrc.gov.uk/cnr/faqs_general.htm

K14

Hi

We're in the same position as you - husband is on a 2 year secondment from the UK. We have declared ourselves non resident for UK tax but were advised that we still have to pay UK Ni contributions - I'm pretty sure the Ni is being deducted from his salary here.

He works for an international firm of accountants - who gave us the advice so I would be surprised if they were wrong (although you never know ).

Sorry no more info for you but you're not alone!

moneypenny20

It's normally up to you if you want to continue paying. If you're definitely going back I would recommend you continue to pay. Even if you're not sure, you can continue paying a minimal amount and then make the decision when you know for sure.

ABCDiamond

Workers who are sent to work abroad by their employers in countries not covered by EC or Reciprocal Agreements have to pay Class 1 contributions for the first 52 weeks that they work abroad where certain conditions are satisfied.
Once the 52 weeks have come to an end the guidance and advice that we provide indicates that these employees should pay Class 3 contributions.

Following a review of the legislation these employees can pay either Class 2 or 3 contributions currently £2.10 or £7.35 per week respectively, provided they satisfy the criteria listed below.
In view of the fact that our guidance and advice indicated that only Class 3 contributions could be paid, those posted workers who have paid Class 3 contributions can apply to have the contributions converted from Class 3 to Class 2, and any balance refunded.
This will apply for Class 3 contributions payable from April 2000 as Class 2 contributions were more expensive prior to this date.

In order that the contributions can be converted and the balance refunded the following conditions need to have been fulfilled:

The employer must have a place of business in the UK.
The employee must be ordinarily resident in the UK.
Immediately before commencement of the employment abroad the employee was resident in the UK.
The employee has paid Class 1 NICs for 52 weeks whilst abroad and
From April 2000 the employee has been paying or has paid Class 3 contributions whilst working abroad.
If these conditions are all satisfied the employee should write in and ask for conversion of Class 3 contributions paid to Class 2 and a refund of any balance and to pay Class 2 contributions for the remainder of their period of posting abroad.


http://www.hmrc.gov.uk/cnr/osc.htm

Worth looking at the above...

Still_Searching

OK, the answer is no, I cannot get out of paying UK NI. I am not sure yet of what to do- the move is no longer affordable through.
Basically, just a fact for future users: "If you are going to work with your own company outside of Europe, you have to pay UK NI at 11% of your earnings for first 52 weeks". Rubbish

calNgary

But you would gain by not paying as much tax as you will have 2 part years in uk & 2 part years in australia if you time it right you may only pay full tax for 2yr out of 5yr i think

mkp

Perhaps you could become employed by an Australian subsidiary company of the UK parent company. If one doesn't exist, why not set one up?
good luck mkp