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to think this smacks of tax avoidance?

(38 Posts)
user1489567377 Wed 15-Mar-17 08:55:50

so wise mumsnetters tell me the hole in this

friends child age 21 joint UK/NZ passport holder (lives in NZ)

coming to work in Greece for 6 months

apparently needs to be paid in the UK to a UK bank account

she doesn't have an account can't open one

we were asked to 'receive' the money for her and have said no

but surely she should be paid in Greece so she can pay Greek tax?

I'm thinking that the company is trying to benefit in some way, I'm not sure what? avoiding paperwork, paying a lower salary, avoiding Greek tax, is there a Greek NI/PAYE?

I have told them this (from the angle that they need to make sure their 21 yr old daughter is fulfilling her tax obligations because she is liable and doesn't want to end up in prison somewhere she speaks none of the language) but I'm being criticised and told I'm wrong

apparently you pay tax through your employer's domicile - so if you work for a foreign company no UK tax payable well I never.

Am I wrong?
surely she has Greek tax liability and no UK tax liability and an attempt to pay her in the UK is tax fraud?

Have I been thinking all this time that employees of Amazon and Starbucks and a whole heap of other companies are on PAYE like us fools but the reality is no one apart from PAYE is actually paying tax?

user1489567377 Wed 15-Mar-17 08:56:09

why is my post purple?

TeaBelle Wed 15-Mar-17 08:59:32

Your posts will always look purple to you, op is in green (if not you) and one's own posts in purple for ease of picking them out I guess

user1489567377 Wed 15-Mar-17 09:03:31

Ah OK

I lost my original log in when there was some hacking thing and haven't been posting since, I thought it was some kind of warning to others smile smile

araiwa Wed 15-Mar-17 09:04:16

you clearly have no idea of any of the rules, regulations or laws

try finding out so you can make a decision based on more than ignorant guesswork and speculation

specialsubject Wed 15-Mar-17 09:07:15

If it is repping for a UK company, some of them employ as UK employees and pay in pounds. All national insurance paid, tax if applicable. So it might be that.

21 is an adult and the worker should deal with this. Not your problem.

MilkTwoSugarsThanks Wed 15-Mar-17 09:07:35

Whatever the rules and regulations are I'd say no anyway, in case HMRC spot you have an "extra income" and hit you with a tax bill for it!

I wouldn't put it past them hmm

KKthePanda Wed 15-Mar-17 09:09:52

I just wouldn't be doing that regardless of the tax implications, being paid money into your account for someone else, i feel that will be an absolute drama waiting to happen, just say sorry you think it'll be too complicated And you won't do it

AliceByTheMoon Wed 15-Mar-17 09:10:47

araiwa would you accept money into your account for a friend's child who was working abroad?

I have worked all over the world on short and long term consultancies for 17 years. The people paying your friend's child ought to be able to pay direct into her NZ bank account. They might kick up a fuss, but they should be able to do it. If not, then I would be wondering why.

araiwa Wed 15-Mar-17 09:12:46

i would find out what the rules and regulations were then make a decision

Stickerrocks Wed 15-Mar-17 09:12:52

Your point about Starbucks etc is completely wrong.

You should not agree to have the 21yo's money paid into your bank account. You could easily come under suspicion of money laundering if you are collecting funds from overseas to simply pass them on to another overseas bank account.

Forget the rest of it as you know nothing about international employment tax regulations.

wowfudge Wed 15-Mar-17 09:16:11

The major reason I wouldn't do this would be implications from a money laundering perspective. Even if everything worked out okay for her (how is she going to get her hands on any of this money btw?), if you ever need to provide bank statements, etc for anti-money laundering purposes, it will look dodgy as hell.

araiwa your post is just very unhelpful - why bother?

dowhatnow Wed 15-Mar-17 09:17:04

Yes I'd be more worried about money laundering rather than tax.

user1489567377 Wed 15-Mar-17 09:20:16

sorry guys

clearly from my post I have very little idea about Greek tax for temporary workers that's why I'm asking, it is curiosity on my behalf, we've said no and wont be changing that whatever people say.
Nor will I be passing on a link to the thread to my friend it's up to her but stuff has been said that's got me curious

I guess there are 2 ?

I'm right aren't I if you live and work work in the UK for an overseas company you pay tax in the UK?
Is it right that there are loads of people in the UK paying tax in Sweeden, USA, France, etc etc etc based on where their company has a head office.

Surely they are on PAYE like the rest of us (excluding the very wealthy non dom stuff)

this is my curiosity

I've thought this for ages but feel it's a bit like discovering the words of a song are not what you've thought they are,.
All these years, I've been talking about tax, moaning about tax, filling in tax returns all that stuff assuming that the people I'm talking to are the same!

Second question is surely if you live and work in Greece all be it temporarily you need to pay Greek tax.

Job is not a rep, will be employed for 6 months maybe longer

araiwa Wed 15-Mar-17 09:21:34

mu post is telling op to find out more information- its about the most helpful thing one can do

user1489567377 Wed 15-Mar-17 09:22:47

I am worried about money laundering but I'm not because I never entertained the thought for 1 second that I would do it.
I've seen enough threads on here to know that's daft.

So if I get a job for Starbucks I pay tax in ? USA ? Luxembourg?

wowfudge Wed 15-Mar-17 09:23:23

I think the whole set up sounds dodgy tbh and wonder what work this person would be doing, what the visa requirements are, etc. Just no. And why is this person unable to open a bank account?

AliceByTheMoon Wed 15-Mar-17 09:24:35

TBH My immediate thought was not tax but money laundering also.

The whole thing sounds a bit dodge.

EyeStye Wed 15-Mar-17 09:25:48

It's potentially the case that the Greek company need to pay her in a UK bank account but that's a matter of Greek law and not something you should really take it upon yourself to research! It's not English law that if you work for a foreign company in England you are taxed in the foreign country.

Just say No I do not feel comfortable doing this. That's enough.

user1489567377 Wed 15-Mar-17 09:26:29

I've googled it all suggests tax is payable in Greece.

I'm not doing it so I don't need more information about that aspect.

I've been told by several people that I am wrong and that you can do an arrangement just like this because tax isn't liable, so I am questioning myself.

Surely tax needs to be paid in Greece? by paying money into UK bank account they are avoiding this

wowfudge Wed 15-Mar-17 09:26:29

If you work for Starbucks here in the UK you pay tax and NI in the UK. Doesn't matter where the company is domiciled. Can you imagine how popular they'd be as an employer if there were tax advantages?!

darceybussell Wed 15-Mar-17 09:26:38

No OP if you work in the UK you usually pay tax in the UK, then there are a whole host of double tax agreements with hundreds of countries where the other country might agree to let the foreign worker have a deduction for the tax they have already paid in the UK. It's not as easy as that to just not pay tax.

Stickerrocks Wed 15-Mar-17 09:26:59

The only people who would know all of the ins and outs of tax in Greece for non-dom temporary workers are probably Greek accountants. I'm a UK accountant and I would be unable to advise on this without specialist knowledge.

Meanwhile in very basic terms, if you live & work in the UK, you pay UK tax regardless of where your employer is based. If your employer is registered in Norway, but has a branch in the UK, they deduct PAYE & NIC from your salary and pay it across to the UK authorities. Don't fret about Starbucks, Amazon etc. They are quite happy to pay tax on behalf of their workers, it's just the minor matter of their own corporation tax liability which is an issue.

Stickerrocks Wed 15-Mar-17 09:29:48

BTW tax avoidance is legal, whereby you minimise your tax liabilities through legitimate but sometimes unethical means. Tax evasion is illegal. The difference between them is the thickness of a prison wall!

AppalazianWalzing Wed 15-Mar-17 09:30:52

The set up you're describing sounds v confusing.

But basically: if you are legally able to work in most countries, certainly in the EU, you'll be issued a national insurance number or equivalent.

If you're tax resident in that country, and legally working there, then you will pay income tax in accordance with their rules.

To be tax resident, you have to spend a certain number of days a year there- generally about six months. If less than this, then I think any tax you would have paid can be refunded to you, but I'm basing that on my personal experience of moving country mid-way through a tax year. Tax resident is different than domicile, which essentially refers to where you plan to return v long term - where you'll be buried was one measure- and while it affects certain taxes it doesn't mean you're exempt from paying income tax if you're resident in a country, even if you don't plan to reside there forever.

If you are, say, working and employed by a U.K. country that sends you abroad for a short term contract, then that doesn't change- your contract, terms of employment etc remain where you're usually taxed even if you're in the States for two months finishing up a deal. But this only applies for a certain amount of time.

There are, however, all kinds of different ways of setting things up- people can officially be contractors or consultants, etc etc, an big companies can make deals with revenue authorities in other countries about how their staff should be treated - but that is basically how things work. (Note: not an expert, ha e lived and paid tax in a number of different countries) So she could be in Greece for say three months and not have a tax obligation because it's not long enough, but this would depend on their rules.

The issue of what bank account you're paid into is entirely separate, and money laundering rules would be a concern. There's no reason the Greek org couldn't issue her with a pay slip, deduct tax and then pay her salary into a NZ or U.K. account except for banking fees- but she won't be able to set up a U.K. account easily without being resident.

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