Using DTA to avoid UK 90 night rule, possible?

[Barney2201]

I had a slightly 'intoxicated' conversation with a tax specialist recently who claimed it's possible to use a DTA to work more than the SRT test will allow in the UK but keeping tax low living abroad, is this really possible?

Have a 'growing in success' UK / International business which is becoming harder and harder to manage within the 90 midnights (left UK in 2019 for Channel Islands)....

Would something like an Irish Non-Dom allow me to declare my earnings in the UK (physical days worked in the UK) in Ireland and pay Irish tax using the DTA whilst having a hold Co (and for my business a design company) in an tax efficent location or do CFC rules get in the way?

I think the tax specialist mentioned Cyprus as a possible option as well but I couldn't be sure....

The dream is the ability to work in the UK around 110 - 120 days per year

Maybe just a dream but thought it was an interesting question to ask.....

 

[Marzio]

If you have an international business why do you need to work in the UK?

 

[Barney2201]

The business is split in two (events business) we design the events outside of the UK and the effective management and control is outside of the UK, the UK company then producers the events (nut's and bolts end) which are often in the UK. Hence needing to be able to be onsite at the UK events....

 

[daniels27]

Hey Barney

Yes, this is possible. But it really depends on the country you want to stay in as not all DTAs are identical. For example UK - Hong Kong has the following clause

he shall be deemed to be a resident only of the Party in which he has a permanent home available to him; if he has a permanent home available to him in both Parties, he shall be deemed to be a resident only of the Party with which his personal and economic relations are closer (“centre of vital interests”);

Interest and dividends can then only be taxed in the country you are resident. In the case of Hong Kong, they would be tax-free.

For employment income you can then still work 183 days in UK (for Hong Kong example):

1. Subject to the provisions of Articles 15, 17 and 18, salaries, wages and other similar remuneration derived by a resident of a Contracting Party in respect of an employment shall be taxable only in that Party unless the employment is exercised in the other Contracting Party. If the employment is so exercised, such remuneration as is derived therefrom may be taxed in that other Party.
2. Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of a Contracting Party in respect of an employment exercised in the other Contracting Party shall be taxable only in the first-mentioned Party if:
   (a) the recipient is present in the other Party for a period or periods not exceeding in the aggregate 183 days in any twelve-month period commencing or ending in the taxable period concerned, and
   (b-d) ...

Hence yes, it would be workable and I know many people that do it that way.

Which country are you thinking of living in for this?

 

[Marzio]

Hence needing to be able to be onsite at the UK events....

Imho you should take this 90 days presence hard limit to push yourself and train somebody so that he could be onsite at UK events.

 

[Barney2201]

Marzio, I hear you loud and clear, finding staff is a bloody nightmare at the moment, we are specialist technical suppliers and competing with a freelance market which is diminishing in size which means more work for the freelancers who don't want to be employed..... Long term goal is to return to using the 90 night rule but I'm looking for a 2-3 year solution with re-location.

Jurisdictions which come to mind are Ireland (non-dom), Cyprus, Spain (Digital Nomad Visa and revised Beckham law) further afield would be Mauritius, UAE and Barbados (Digital Nomad visa).

 

[daniels27]

Jurisdictions which come to mind are Ireland (non-dom), Cyprus, Spain (Digital Nomad Visa and revised Beckham law) further afield would be Mauritius, UAE and Barbados (Digital Nomad visa).

I checked some, I think it should be workable with some effort. I.e. you cannot be employed by a UK company etc. Are you the manager of either the UK or non-UK company? How to you get reimbursed for your work performed in the UK?

Marzio, I hear you loud and clear, finding staff is a bloody nightmare at the moment, we are specialist technical suppliers and competing with a freelance market which is diminishing in size which means more work for the freelancers who don't want to be employed..... Long term goal is to return to using the 90 night rule but I'm looking for a 2-3 year solution with re-location.

Yes, but what is the daily pay you would offer if you do not have to do it yourself?