DH has accepted a 6 month contract job from an English company working in Indonesia. They mentioned having an umbrella company to accept his wages (seems the norm for contract workers). They know he's resident in Canada but keep saying about paying tax and NI to HMRC. I know we'll be expected to file a tax return here so how do we work around it? We will get an emergency appointment with an accountant next week (DH is leaving 5 September). Obviously we know we have to pay tax to someone but who?

If he is tax resident of Canada, Canada is where taxes are paid. HRMC have nothing to do with it.

If he registers a corporation in Canada to do the billing through, this will be governed by Canadian law and tax liability to Canada. The corporation will pay him,which is altogether separate and again a Canadian affair.

There is no work around, it is cut and dried. Tax residents in Canada pay tax in Canada.

Thank you. It all seems rather complicated so good job we're going to speak to an accountant. Why they can't just pay into his bank account and then we pay the tax from the tax return calculation I don't know but we are law abiding people so will ensure we do it right. I'm very annoyed with DH taking this job as it is a real ball ache for six months work. Hopefully when he gets back he'll get a job here where things are a bit easier although we will keep the accountant to ensure we do it right. PAYE seems a distant memory, a lot easier!

You say the contract is with an ENGLISH company? If so then IIRC they are supposed by UK law to deduct tax and NI, even though he is a contractor unless he proves he's not tax resident.(That's why an umbrella company has been mentioned , a common way of reducing tax liability)This came about due to the vast number of so called self-employed people in the UK getting paid gross and not paying the correct tax to HMRC.The law was changed so that if you worked primarily for one company, that company was required to deduct tax and NI and it was up to you to reclaim anything when you did your annual tax accounts.As self employed there are allowances you can claim which a PAYE employee cannot. If he is a Canadian citizen though, then I would have thought they could pay him direct into his Canadian bank account so long as he issues an invoice to them each month with a Canadian address, thus showing he is non resident in UK. Funnily enough, I did this some years ago for a couple of part time contractors I employed in Vancouver to do some install work on the Skytrain. They billed me each month and we transferred payment direct to their Canadian accounts with no deductions. If HMRC queried it - they did once - we had the paperwork to prove the guys were not resident in UK NOR directly employed by us. I'm sure the accountant will sort it out.

Not if he is a non resident of the UK and was so at the onset of the contract and the payments are sent overseas. UK companies pay overseas contractors all the time without withholding tax.

This is another level of separation, but unnecessary for an overseas resident.

Irellevent as the OP is referring to a non UK resident working outside the UK for a UK company.

Does not matter what citizenship he has, if he is not resident for tax purposes in the UK. Additionally, whether they send a cheque, pay by visa or direct deposit, the result is the same.