How to be paid in AU by a UK company
Mar 27th 2016, 6:02 am
#1
Just Joined
Thread Starter
Joined: Jul 2011
Posts: 4
How to be paid in AU by a UK company
Hi
I will try and keep it brief. I am from the UK and live in AU, and am a citizen of both.
Recently I was offered work by some friends at a UK company to sell their software in Australia, as they want to branch out. For reasons I don't need to waffle about we'll delay setting up a company out here whilst we see how it goes, as they want to keep things simple to start off with.
This is fine by me, but the question I have is about how they can pay me a salary as I had planned to set up a company and invoice them. Initially they asked their payroll provider if I can be paid as a foreign employee, but this was poo-pooed for whatever reason, and they then suggested treating me as a UK employee and being paid as if I was working there, using my UK bank account and parents address. I am not certain this is a good idea, as surely I will run into tax issues and is probably not strictly legal! I would like to avoid having the old bill conduct a dawn raid on my mum and dad's, helicopters and such.
Has this come up before? Apologies if my search didn't unearth it.
If not can anybody
- point me to the right kind of person I might speak to here in AU? I am not convinced I would get the right advice from your average local tax accountant. I am in Sydney if there's someone recommended.
- give any advice from experience if you have any
- suggest what the company might do from their end. Transfer it by SWIFT? Is that best?
Failing that perhaps there's a clever scam to be taken advantage of. Special points to anyone ending replies with nudges, winks or 'what the taxman doesn't know...' or indeed 'it's TECHNICALLY legal' and so on!
Thanks for reading.
I will try and keep it brief. I am from the UK and live in AU, and am a citizen of both.
Recently I was offered work by some friends at a UK company to sell their software in Australia, as they want to branch out. For reasons I don't need to waffle about we'll delay setting up a company out here whilst we see how it goes, as they want to keep things simple to start off with.
This is fine by me, but the question I have is about how they can pay me a salary as I had planned to set up a company and invoice them. Initially they asked their payroll provider if I can be paid as a foreign employee, but this was poo-pooed for whatever reason, and they then suggested treating me as a UK employee and being paid as if I was working there, using my UK bank account and parents address. I am not certain this is a good idea, as surely I will run into tax issues and is probably not strictly legal! I would like to avoid having the old bill conduct a dawn raid on my mum and dad's, helicopters and such.
Has this come up before? Apologies if my search didn't unearth it.
If not can anybody
- point me to the right kind of person I might speak to here in AU? I am not convinced I would get the right advice from your average local tax accountant. I am in Sydney if there's someone recommended.
- give any advice from experience if you have any
- suggest what the company might do from their end. Transfer it by SWIFT? Is that best?
Failing that perhaps there's a clever scam to be taken advantage of. Special points to anyone ending replies with nudges, winks or 'what the taxman doesn't know...' or indeed 'it's TECHNICALLY legal' and so on!
Thanks for reading.
Mar 27th 2016, 6:32 am
#2
Lost in BE Cyberspace
Joined: Feb 2009
Location: UK
Posts: 14,284
Re: How to be paid in AU by a UK company
It would definitely be illegal to run this by pretending you are a UK employee and resident and only declare the income to the UK authorities. You are obliged to declare this income on your Australian tax return.
As such it makes no sense to run this through a UK payroll as there would be unnecessary and irrecoverable deductions for both you and the employer, such as the employee and employer national insurance contributions and possibly pension contributions which are now mandatory in the UK in certain situations.
Your plan of contracting and invoicing is the one that makes most sense to me. You could also look up a payroll services provider (an Australian one) and see if they can meet your needs. I am not sure why you think a local tax accountant wouldn't be a good idea, it sounds like the perfect idea to me.
In terms of your final comment about their being a suitable scam, well if you don't want to declare your income then don't but be prepared for consequences such as fines / prosecution / imprisonment etc. if you are discovered. Frequent transfers from overseas could lead to such discovery.
As such it makes no sense to run this through a UK payroll as there would be unnecessary and irrecoverable deductions for both you and the employer, such as the employee and employer national insurance contributions and possibly pension contributions which are now mandatory in the UK in certain situations.
Your plan of contracting and invoicing is the one that makes most sense to me. You could also look up a payroll services provider (an Australian one) and see if they can meet your needs. I am not sure why you think a local tax accountant wouldn't be a good idea, it sounds like the perfect idea to me.
In terms of your final comment about their being a suitable scam, well if you don't want to declare your income then don't but be prepared for consequences such as fines / prosecution / imprisonment etc. if you are discovered. Frequent transfers from overseas could lead to such discovery.
Mar 27th 2016, 6:35 am
#3
Just Joined
Thread Starter
Joined: Jul 2011
Posts: 4
Re: How to be paid in AU by a UK company
Thanks for this, the last comment was tongue-in-cheek, sorry if not clear. Appreciate any more relevant, legal replies.
