Kurg

Hello British Expats,

I've signed up to this as I've taken a temporary position with the Abu Dhabi government, to assist them with a special project. I'm going to be spending 2 or 3 weeks out of every month in Abu Dhabi, and the rest of the time back in the UK or travelling elsewhere in the world.

I'll post something more social a bit later, but what concerning me now is a tax question. Since I'm only going to be here for at most 9 months, I'm not going to be losing my UK residence, so I'm still going to be paying UK tax. In general, that doesn't bother me.

However, my accomodation while in Abu Dhabi is being covered by an allowance in my salary (which will come direct from AD government). So here is my question. Is the money I then spend on accomodation in AD claimable as a business expenses and thus tax exempt in the UK, or will I have to pay tax on all of it as income? And would it make a difference if I stayed in hotels or a rented apartment? (Assuming, that through blind luck I found rental accomodation for 6 to 9 months).

This one completely stumped the UK tax office when I asked them (they told me to write a letter and wait a month for a response), so I thought I'd try asking here, as I've seen there is a tax expert or two around.

Apologies if I've left out any crucial information required to answer my question.

Blue Cat

why not try and stay out of the UK more so you don't have to pay any tax? Are you James Bond

Kurg

I'm leaving a wife and kids in school back in the UK (wife doesn't want to quit her job), so even if I got enough time away, I think HMRC would still argue I had sufficient ties to the UK (and I need to be back there quite a bit for my job so might struggle to manage less than 90 days).

Unfortunately I'm not James Bond, just a rather dull bureaucrat.

shiftdelete

James Kurg Bond- why Kurg- you're practically permanently outside the UK...moneypenny getting on your nerves?...ah- see you've just answered it all, good luck

Bermudashorts

Yes a housing allowance in your salary would definitely be taxable in the UK.

Meow

The housing allowance is the equivalent of a 'benefit in kind' and thus liable for UK income tax.

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soukie

My husband used to work all over the UK at one time and often stayed away from Mon - Thursday and received living away from home expenses from his employer - this was not taxable as he still maintained the family home. Wouldn't the same apply in this case ?

Bermudashorts

If your usual place of work is in London, say, and you are sent away on business then of course those expenses are business expenses. But that does not sound like the case here, it sounds like the OP is taking a new job which is based in Abu Dhabi. He is not going on business to Abu Dhabi.

If he made himself self employed and then went to Abu Dhabi on a contractor basis, the housing expense would still not be tax deductable as it would fail the wholly, exclusively and necessarily test for business expenses.

As he is not out of the country long enough to be calssed as non-resident, the entire income, including housing allowance is most definitely taxable in the UK.

Kurg

Thanks for the advice everyone. Sounds as if I would have been better off being still payed from my employer in the UK. I may try to renegotiate this in the future.