Self Employed in the US and getting paid in the UK
Dear All,
I have recently moved to Houston TX due to my husband relocation and I have a bunch of questions I hope somebody can help. I am looking to set myself up as a freelancer here in the US ( paying US taxes) but working primarily for my ex employer back in the UK as consultant instead as employee . I will be paid in GBP - Does anyone know what is the best way to handle this transaction? Would it be better for my UK employer to pay me in my UK bank account and then transfer the money with Tranferwise/ revolut etc.( I OR should I get paid in my US bank account and potentially loose money in transfer fees? Thank you very much - any advise will be much appreciated Barbara |
Re: Self Employed in the US and getting paid in the UK
first question - what's your visa?
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Re: Self Employed in the US and getting paid in the UK
Hi ! I am on an E2 spouse visa - My EAD card is on its way - After it arrives I will need to start the process to set myself up as self-employed ( advise on this will also be welcome)
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Re: Self Employed in the US and getting paid in the UK
Originally Posted by BarbaraB
(Post 12848370)
Would it be better for my UK employer to pay me in my UK bank account and then transfer the money with Tranferwise/ revolut etc.( I OR should I get paid in my US bank account and potentially loose money in transfer fees?
Barbara |
Re: Self Employed in the US and getting paid in the UK
Originally Posted by lansbury
(Post 12848375)
One other point to consider if you are paid directly into your US bank account, you have no control over the exchange rate. You get what it is when they pay you. If paid into a UK account you do have some control as you can move the money when you want to, and pick the exchange rate.
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Re: Self Employed in the US and getting paid in the UK
Or could you bill them in USD and have them ride the currency wave?
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Re: Self Employed in the US and getting paid in the UK
Originally Posted by tom169
(Post 12848417)
Or could you bill them in USD and have them ride the currency wave?
Exactly what I do for my overseas clients. Most are also able to wire to me without fees (I have no fees from my bank at this end) and for those who do take a fee, I build it into my bill. OP, if you search the forum, you will find a few threads on the topic of being self employed in the US with international billing. |
Re: Self Employed in the US and getting paid in the UK
Originally Posted by tom169
(Post 12848417)
Or could you bill them in USD and have them ride the currency wave?
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Re: Self Employed in the US and getting paid in the UK
Originally Posted by BarbaraB
(Post 12848423)
unfortunately that's not an option ..
If not, I would increase the hourly rate in UKP to incorporate an exchange rate buffer and also the bank charges. I would also have it paid directly into my US business bank account - don't forget that bank fees for this are tax deductible items. I'm assuming you've also figured out how much social security and tax you are going to have to pay? |
Re: Self Employed in the US and getting paid in the UK
Originally Posted by petitefrancaise
(Post 12848446)
well, I'd push back on that one. If they are prepared to pay directly into your US bank account then simply agree an hourly rate in US$ with them that suits you both. It could be just an average of the exchange rate of last year or whatever.
If not, I would increase the hourly rate in UKP to incorporate an exchange rate buffer and also the bank charges. I would also have it paid directly into my US business bank account - don't forget that bank fees for this are tax deductible items. I'm assuming you've also figured out how much social security and tax you are going to have to pay? |
Re: Self Employed in the US and getting paid in the UK
Originally Posted by BarbaraB
(Post 12848708)
That's a really good idea actually Thank you very much for your suggestion- I am going see if we can agree on an $ rate based on average exchange rate - In regards to social security and tax.. I am still look into it - I will set 20% to stay on the safe site . I initially thought I had to register as a business but the more I am reading the more I have come to the conclusion I may not need to do it and just stay as a freelancer. -do you have any suggestions or do you know of any legal requirements whereby i need to set myself up as Sole Proprietor ? Was also planning to invoice using Quickbooks or similar - Thank you again !
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Re: Self Employed in the US and getting paid in the UK
Originally Posted by Nutmegger
(Post 12848752)
I work as an independent contractor and have no necessity for any kind of formal business entity; I do the work, and I bill! Others have said that they have used an S Corporation or similar, but it probably depends on what you do.
You need to set up as a "doing business as" (DBA) in Texas. |
Re: Self Employed in the US and getting paid in the UK
Originally Posted by petitefrancaise
(Post 12848802)
You need to set up as a "doing business as" (DBA) in Texas. To clarify for the OP, presumably only if you are working under an entity other than solely your actual name? |
Re: Self Employed in the US and getting paid in the UK
Originally Posted by Nutmegger
(Post 12848809)
To clarify for the OP, presumably only if you are working under an entity other than solely your actual name?
Start A Business It also stops other people using your name for their business |
Re: Self Employed in the US and getting paid in the UK
Originally Posted by BarbaraB
(Post 12848382)
Thank you that's exactly my worries. I just wondered if there were any restrictions or any downsides to this
Downside is you wait to move the money and the rate drops, and you either have to wait for it to come back up or take a loss. For most people it isn't huge sums, but I receive several hundred extra dollars a year doing the transfers myself. |
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