Tax issues on secondment
UK co[A] is contracting with a Client UK [B] companys Asia subsidary [ S ]
This will require the director/employee of [A] to ‘relocate’ for 3 months to SE Asia
The bulk of the work will be done in Asia/Australasia
Some small amount may be billed from being done in the UK
Questions relate to the contracting / invoicing and expenses
1] A will invoice time + materials in which ever currency is the contracted currency [ to include international flights, accom/or agreed site per diem, local transport and sundry agreed expenses] to S
a] There is no VAT billed to S ?
b] If this were to be contracted & invoiced to B instead [an option ] with the works being outside the UK would this change ?
2] If S is the contracted party, and upon return to the UK, work is undertaken and completed in the UK then presumably no VAT is charged ?
3] Director employee / expenses to A should equal actual incurred costs of all the above – and if accommodation was not say a hotel room for 3 months but say a Serviced Apartment……any issues then re accomodation
Are there any grounds for claims on meals / shopping or laundry related costs ???
[ reason to try to negotiate a generous per diem to cover full cost from client !!! ]
4] Director employee and Co A paye + ni issues on the expenses.
a] Given the tenure – full UK home to be maintained – would like to appreciate potential issues / or correct best practice.
b] Any allowable claims by Director/employee over and above receipted items [ ie HMRC non taxable/non nic’able allowances ? ]
5] Co A will pay monthly salary etc as normal to UK account. With usual PAYE/NI
Generally speaking, is there a personal tax issue arising from a Director/employee spending, so much time as a secondee in another jurisdiction. Is it better to Break it with a return to say UK
Appreciate the company A may make a profit if a per diem is agreed that is greater than actual incurred/billed accommodation + expense costs.
Also appreciate a currency risk if invoicing S in local currency.
Interested to hear from anyone who has had such an ‘assignment’ and the best practice arrangement established
Friday afternoon – sorry for long post
Have a good weekend!