Company Car for Foreign Employee

Company Car for Foreign Employee

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We have employed Dutch national as our european sales manager and have provided him with a company car. What if any company car tax implication on the company. We pay him every month gross salary and he is responsible for his local tax and national insurance.

ansar riaz

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By thehaggis
21st Feb 2008 00:08

That clears things up.

As Euan says his earnings are not likely to be taxable in the UK, unless the UK duties are something more than incidental to main overseas duties. If he come to the UK to report what is happening in mainland Europe and/or take instruction he should be OK; if he comes to plan strategy or give instructions, these could be regarded as substantive duties.

If he is not liable to UK tax, his earnings cannot be PAYE earnings for the purposes of your PAYE requirements. You can disregard my comments about P11D's etc

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By ansar riaz
20th Feb 2008 17:08

Lives and Works in Holland
Thank you very much for your help.

He lives and works in Holland and responsible to pay all his local tax and NI. He only visits to UK for meetings every few months and he normally fly in and out of UK.

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By Euan MacLennan
20th Feb 2008 11:29

Yes, but ...
... where does he live and work? If he is responsible for local (Dutch?) tax and national insurance, it sounds as if he lives in Holland (or somewhere else outside the UK), in which case he is not resident in the UK for tax purposes. If he is not resident and works entirely outside the UK (apart from incidental visits to the UK for meetings, etc.), he is not liable to UK income tax on either his salary or his benefits in kind. If he works (say) 4 days a week in Europe and 1 day a week in the UK, you can reach an agreement with the Revenue that only 1/5th of his salary will be taxable in the UK. If he is not subject to UK income tax, the company is not liable to pay Class 1A NIC on his company car.

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By thehaggis
19th Feb 2008 23:26

He's an employee

Based on the limited info you have given, he is an employee and you should be treating him the same as any other. That means PAYE/NIC, P11D and P46(car). His nationality does not affect this,

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