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Work remotely for UK company, live is Spain

Work remotely for UK company, live is Spain

Old Jul 23rd 2019, 12:41 pm
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Default Work remotely for UK company, live is Spain

Hi all,

I'm self employed (one-man-band limited company) in the UK with a long term contract with a UK Client. My wife and I (both Spanish) are planning to move to Spain as soon as possible. I spoke with the UK Client and they have agreed to let me work remotely from Spain but they want to understand how the arrangement will work. I have read many posts from this forum (thank you all!) but I still have questions, perhaps due to the complexity of the arrangement.

The current arrangement is as follows:

My UK Ltd company invoices an Agency contracted by the UK Client, where I undertake my work. The UK Client pays the Agency, the Agency pays my UK Ltd company and my UK Ltd company pays me. I take salary and dividends from my company.

So far, I have come up with these options:

1. I register as self-employed in Spain and bill my UK Ltd company.
2. I register as self employed in Spain and bill the Agency.
3. I register as self employed in Spain and bill the UK Client (they might be happy to do that and not going through the Agency).
4. I become a permanent employee and the UK Company registers on the Spanish Social Security register. This option is very unlikely as I will be the only employee in Spain.
5. Use an Employer of Record company (i.e. ShieldGo, Velocity Global) which will take care of contract, taxes, social security, etc. I'm not sure of the cost of this option and whether the EoR would invoice my UK Ltd company, the Agency or the UK Client.

I will much appreciate you comments on these options. Many thanks.
Eduardo
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Old Jul 23rd 2019, 6:45 pm
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Default Re: Work remotely for UK company, live is Spain

Originally Posted by esanchezros View Post
Hi all,

I'm self employed (one-man-band limited company) in the UK with a long term contract with a UK Client. My wife and I (both Spanish) are planning to move to Spain as soon as possible. I spoke with the UK Client and they have agreed to let me work remotely from Spain but they want to understand how the arrangement will work. I have read many posts from this forum (thank you all!) but I still have questions, perhaps due to the complexity of the arrangement.

The current arrangement is as follows:

My UK Ltd company invoices an Agency contracted by the UK Client, where I undertake my work. The UK Client pays the Agency, the Agency pays my UK Ltd company and my UK Ltd company pays me. I take salary and dividends from my company.

So far, I have come up with these options:

1. I register as self-employed in Spain and bill my UK Ltd company.
2. I register as self employed in Spain and bill the Agency.
3. I register as self employed in Spain and bill the UK Client (they might be happy to do that and not going through the Agency).
4. I become a permanent employee and the UK Company registers on the Spanish Social Security register. This option is very unlikely as I will be the only employee in Spain.
5. Use an Employer of Record company (i.e. ShieldGo, Velocity Global) which will take care of contract, taxes, social security, etc. I'm not sure of the cost of this option and whether the EoR would invoice my UK Ltd company, the Agency or the UK Client.

I will much appreciate you comments on these options. Many thanks.
Eduardo
This issue is well-documented in past threads but the key hurdle you must jump is how the Spanish tax Authorities view your proposed situation. They are very tough on the "Self-Employed Single Employer Situation" basically regarding it as a tool by which companies avoid their Social Security liabilities and will therefore pursue action against your employer. Invariably the employer will lose in any labour tribunal judegment.
The "safest" , not necessarily the best option is that you become a direct employee of the company simply being resident in Spain.
Alternatively find yourself more "clients" thereby justifying your situation in the eyes of the authorities.
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Old Jul 23rd 2019, 7:01 pm
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Default Re: Work remotely for UK company, live is Spain

Originally Posted by Loafing Along View Post
This issue is well-documented in past threads but the key hurdle you must jump is how the Spanish tax Authorities view your proposed situation. They are very tough on the "Self-Employed Single Employer Situation" basically regarding it as a tool by which companies avoid their Social Security liabilities and will therefore pursue action against your employer. Invariably the employer will lose in any labour tribunal judegment.
The "safest" , not necessarily the best option is that you become a direct employee of the company simply being resident in Spain.
Alternatively find yourself more "clients" thereby justifying your situation in the eyes of the authorities.
Hi,

Many thanks Loafing for your answer. I have been looking for similar questions on this site but could not find specific information related to my situation. Perhaps you could send the links to the questions you're referring to?

With regards to your answer, I was hoping that being an autónomo in Spain and invoicing a UK company would not be a problem. Also, my question was more directed to find the best proposal to present to my current client.

Nevertheless I much appreciate your advice.

​​​​
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Old Jul 23rd 2019, 7:04 pm
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Default Re: Work remotely for UK company, live is Spain

Again (dare I mention) who knows how Brexit will rock the boat (Bring on Boris) By all means take feedback from here but I think you need professional advice.
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Old Jul 24th 2019, 3:56 am
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Default Re: Work remotely for UK company, live is Spain

Hopefully you are aware of IR35? https://www.gov.uk/guidance/ir35-find-out-if-it-applies
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Old Jul 24th 2019, 7:43 am
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Default Re: Work remotely for UK company, live is Spain

Originally Posted by missile View Post
Hopefully you are aware of IR35?
Thanks for your reply, that's actually a good point. As far as I understand it depends on where the employee is based but I got the feeling that there is more to it.
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Old Jul 24th 2019, 7:45 am
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Default Re: Work remotely for UK company, live is Spain

Originally Posted by spainrico View Post
Again (dare I mention) who knows how Brexit will rock the boat (Bring on Boris) By all means take feedback from here but I think you need professional advice.
Absolutely, Brexit may/will change rules for sure. I guess the best advice to ask for would from an employment lawyer?
Thanks spainrico
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Old Jul 24th 2019, 8:30 am
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Default Re: Work remotely for UK company, live is Spain

Originally Posted by esanchezros View Post
Hi,

Many thanks Loafing for your answer. I have been looking for similar questions on this site but could not find specific information related to my situation. Perhaps you could send the links to the questions you're referring to?

With regards to your answer, I was hoping that being an autónomo in Spain and invoicing a UK company would not be a problem. Also, my question was more directed to find the best proposal to present to my current client.

Nevertheless I much appreciate your advice.

​​​​
Have a look at a thread from last year , Feb 17th 2018 " "Questions on running a Ltd company while living in Spain" . It may help as there are several comments relevant to your question.
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Old Jul 24th 2019, 10:18 am
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Default Re: Work remotely for UK company, live is Spain

In my case I work for a company in another European company. I bill them monthly. I am a registered autonomo and pay my seguridad social and taxes.

I work for just one company but have never had any bother re the previously mentioned issues with this. I think the Spanish authorities are more interested in finding Spanish companies who are abusing this law.
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Old Jul 24th 2019, 4:23 pm
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Default Re: Work remotely for UK company, live is Spain

Originally Posted by esanchezros View Post
Thanks for your reply, that's actually a good point. As far as I understand it depends on where the employee is based but I got the feeling that there is more to it.
I have some experience in this area and suggest you should seek professional advice. HMRC have investigated a number of limited companies where the only employee has a long standing contract with only one company. They take the view that this person is not really an independent contractor and should be regarded as an employee. This would create serious issues not only for you but also the company you do work for..
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Old Jul 24th 2019, 4:56 pm
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Default Re: Work remotely for UK company, live is Spain

Originally Posted by missile View Post
I have some experience in this area and suggest you should seek professional advice. HMRC have investigated a number of limited companies where the only employee has a long standing contract with only one company. They take the view that this person is not really an independent contractor and should be regarded as an employee. This would create serious issues not only for you but also the company you do work for..
Exactly the same attitude as the Spanish tax authorities
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Old Jul 24th 2019, 8:35 pm
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Default Re: Work remotely for UK company, live is Spain

I think it is what HMRC cover in IR35.
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Old Jul 29th 2019, 11:55 am
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Default Re: Work remotely for UK company, live is Spain

Originally Posted by esanchezros View Post
Hi all,

I'm self employed (one-man-band limited company) in the UK with a long term contract with a UK Client. My wife and I (both Spanish) are planning to move to Spain as soon as possible. I spoke with the UK Client and they have agreed to let me work remotely from Spain but they want to understand how the arrangement will work. I have read many posts from this forum (thank you all!) but I still have questions, perhaps due to the complexity of the arrangement.

The current arrangement is as follows:

My UK Ltd company invoices an Agency contracted by the UK Client, where I undertake my work. The UK Client pays the Agency, the Agency pays my UK Ltd company and my UK Ltd company pays me. I take salary and dividends from my company.

So far, I have come up with these options:

1. I register as self-employed in Spain and bill my UK Ltd company.
2. I register as self employed in Spain and bill the Agency.
3. I register as self employed in Spain and bill the UK Client (they might be happy to do that and not going through the Agency).
4. I become a permanent employee and the UK Company registers on the Spanish Social Security register. This option is very unlikely as I will be the only employee in Spain.
5. Use an Employer of Record company (i.e. ShieldGo, Velocity Global) which will take care of contract, taxes, social security, etc. I'm not sure of the cost of this option and whether the EoR would invoice my UK Ltd company, the Agency or the UK Client.

I will much appreciate you comments on these options. Many thanks.
Eduardo
Right, so I just had a chat with my UK Client and they would prefer me becoming a permanent member of stuff. I have no problem with that but I'm worried that the process involved in setting it up might put them off. I have been searching on the internet and in other chats and the answer below, I think, is the best approach I have found. Has anyone had a similar experience? Has anyone, or know of anyone, who has dealt with a lawyer firm like Strong Abogados or Gascon Bernabeu to do the set up?

Originally Posted by seascape View Post
Hi all - we are a UK company with a Spanish employee who is looking to return home. Our plan is for him to contact HMRC before he goes and advise he will no longer be tax resident which will give him a NT tax code. He will continue to be paid UK salary but this will now be gross into his UK back account. Our company will then register as a non-resident without permanent establishment company in Spain which will give us a social security number so that we can make social security payments, we will also be registered with a non resident VAT number which we need. We are told the social security office requires a Spanish bank account for auto withdrawal of social security payments, and that can be a employee account set up for that purpose. So UK gross funds will get transferred to this new bank account, tax and social security will come off this and the remainder transferred to the employee Spanish account as pay. We then also need to revise his contract to make sure its compliant with Spanish requirements.
At least that's the plan - if anyone sees a flaw please let me know!
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