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Is the NHS classed as a Government employer?

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I have a client who left the UK in December 2017 to move to the USA permanently. 

She worked for the NHS until June 2018. From December 2017 to June 2018 she worked remotely. She then finished working for the NHS and is no longer working.

Article 14 of the double taxation treaty between the UK and The USA states that employment income is taxed in the country of residency unless exercised in the other country. Article 19 however states "salaries, wages and other similar remuneration, other than a pension, paid from the public funds of a Contracting State or a political subdivision or a local authority thereof to an individual in respect of services rendered to that State or subdivision or authority shall, subject to the provisions of sub-paragraph b) of this paragraph, be taxable only in that State;".

For this purpose would the NHS be classed as a government employer and meet the criteria of article 19 and be subject to taxation in the UK?


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21st Jan 2019 17:58

Have a look at the detailed wording of Article 19 of the UK/US DTA.
The structure of the NHS is very complex-for example hospitals are run by NHS trusts, so that it is they who are the employers. It is unlikely that it could be argued that employment is paid"from" public funds. The question arises frequently for quasi-governmental organisations and there is no one answer fits all

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