Employee lives abroad ..

[john_p]

We have an employee who has moved to Italy and lives there permanently.

At the moment we're still paying him monthly salary via bank transfer to an Italian bank, paying PAYE/NI etc as if he was in the UK.

With an eye on the potential NI savings, are we able to do anything any differently? e.g. pay him the gross amount each month and leave the payment of Italian income tax to him?

[edc]

Not too much help but there are some companies who can deal with this for you.

A while back I placed a guy in Italy (who already lived there) but was employed by a UK company. There was no Italian subsidisary but he was paid local currency through I guess some sort of accounting/finance firm. Deductions were dealt with by them too.

[hughesie2]

john_p said:

With an eye on the potential NI savings, are we able to do anything any differently? e.g. pay him the gross amount each month and leave the payment of Italian income tax to him?

would the Employee not be happier with the current arrangement bearing in mind:

A) the Exchange rate is favourable for him at the moment
B) NI stamp continues to be paid and would not affect his Pension/SS/ etc etc

When i moved abroad i wish i'd kept mine up !!

[john_p]

I'm not sure really, I think his intention is to live in Italy permanently so he may be better off taking up whatever "NI" arrangements exist under the Italian system?

Not thought on the exchange rate though, although doesn't he benefit even more if the exchange rate is favourable and we pay him his gross rather than net salay?

[Hughesie2]

john_p said:

I'm not sure really, I think his intention is to live in Italy permanently so he may be better off taking up whatever "NI" arrangements exist under the Italian system? Not thought on the exchange rate though, although doesn't he benefit even more if the exchange rate is favourable and we pay him his gross rather than net salay?

Tax is higher in Itali IIRc

[Eric Mc]

As a non-UK resident, he should not be liable to UK tax or NI. However, he would be liable to Italian tax and their NI equivalent. He would need to contact the Italian tax authorities to find out how he should pay his Italian taxes.