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Tax changes due to Change from Work Permit to TIER 1

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krishna186
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Posts: 39
Joined: Thu Apr 17, 2008 9:12 pm

Tax changes due to Change from Work Permit to TIER 1

Post by krishna186 » Tue Feb 17, 2009 9:49 pm

All,

I have moved to TIER1 visa last year and prior to that I was on a work permit from an Indian large software company and on deputation.

Since my move to TIER1 , I have passed my visa details to my company and am continuing to work for the same company. Whilst on deputation my company pays me allowances in the UK and and full salary back in India and also pays taxes on behalf of me in the UK. It infact has to pay taxes in the UK for the salary I am paid in India ( due to UK tax rules I think ).

Now the question I have is - woud there be any tax change caused due to my move from my compnay workpermit to TIER1 although I am continuing to work for same company and in the same role ?

I also understand that during the first two years on deputation on work permit , my company pays very minimum taxes in UK but after two years I was told that the taxes are quite high ( normal to UK citizen ) . Due to this my company forces people to move back to Offshore after 2 years . Would this be effected due to me moving into TIER 1 ?

Advice from experts in this forum would be much appreciated .

Cheers

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ashishashah
Senior Member
Posts: 723
Joined: Sun Jan 06, 2002 1:01 am
Location: UK
India

Post by ashishashah » Tue Feb 17, 2009 11:33 pm

Well,ask your employer for a PROPER pay slips..It should have your NI number,gross sal,tax paid,NI paid,net salary...

While extending your visa,ILR it will be imp. that you have paid tax..Dont rely on your employer..

krishna186
Newbie
Posts: 39
Joined: Thu Apr 17, 2008 9:12 pm

Post by krishna186 » Wed Feb 18, 2009 8:17 pm

Thanks. I do get a P60 and tax retunr form from my comany every year.But my question was only the tax code change due to me moving to TIER1 . Can someone throw somelight on this esp anyone who are in the same situation like mine ( deputed to UK from India and Indian salary paid into Indian bank account in rupees and paid UK allowance in UK in GBP) ??

Cheers

SKUK
Member of Standing
Posts: 252
Joined: Sun Dec 16, 2007 3:59 pm

Post by SKUK » Wed Feb 18, 2009 8:43 pm

Getting P60 from your employer doesn't necessarily mean they have been paying the correct amount of tax.
How long have you been in UK?

I suggest you visit ListenToTaxMan.com, enter your gross salary in there and check the amount against your payslip. BTW are you getting a proper UK format payslip from your company, like the one that Ashish mentioned you should be in receipt of ?

jaas
Junior Member
Posts: 55
Joined: Thu Feb 09, 2006 7:30 pm

Tax

Post by jaas » Wed Feb 18, 2009 10:40 pm

As per my understanding ...Once you are on Tier 1 means you are a resident in UK for tax purposes so you have to pay full taxes here in UK. UK became your primary home after Tier 1. Thats what you declare in your Tier 1 app..!! UK should be your main home and allowances mean you are not paying right tax here....!!! Could be wrong please wait for senior people on this board. May be your Indian company is doing right thing as per Intra-Company transfer WP & Dual Taxation agreement (two year rule) between India & UK. Those things nolonger applies to you.

krishna186
Newbie
Posts: 39
Joined: Thu Apr 17, 2008 9:12 pm

Re: Tax

Post by krishna186 » Wed Feb 18, 2009 11:23 pm

jaas wrote:As per my understanding ...Once you are on Tier 1 means you are a resident in UK for tax purposes so you have to pay full taxes here in UK. UK became your primary home after Tier 1. Thats what you declare in your Tier 1 app..!! UK should be your main home and allowances mean you are not paying right tax here....!!! Could be wrong please wait for senior people on this board. May be your Indian company is doing right thing as per Intra-Company transfer WP & Dual Taxation agreement (two year rule) between India & UK. Those things nolonger applies to you.
I moved to TIER1 after 2.5 years on my company inter transfer WP. My company has paid proper taxes for 2007-08 as I can see on my tax return form which I signed and was filed by my company on behalf of me. I am not getting the salary slips as mentioned above but only get allowance slips ... and proper salary slips in India . MY UK tax return does cover for the salary paid in India as well as my company would need to pay UK taxes on salary paid in India after 2 years. Also in TIER1 you do not declare that you are making UK as your main home.Infact this has been fundamental change from HSMP earlier . Can you please let me know where in the TIER1 form is it mentioned that you have to make UK your main home ?

Cheers ,

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