Normally anyone working for a UK company would be taxed on employment income in the UK. However because the individual concerned is and will remain a US resident they will also be taxable on employment income there. Therefore you need to resort to the DTA agreement – article 14 is where you should head to. Here’s a link:
Is the UK employment contract subject to local law?
In the case of UK based employers, making the employment contract subject to the local law of the overseas employee’s work place will reduce the chance of a claim in the UK tribunal but it won’t eliminate it entirely. Each case will, in the end, depend on the facts of the actual employment.
When to use UK employment contracts for overseas employees?
Using UK employment contracts for overseas employees If an employee of a UK company is to be based wholly overseas (i.e. outside the UK) it may be unwise to make the employment contract subject to UK law and the UK courts. The better choice may be to make the contract subject to the law of the place of performance of the contract.
What happens if an employee is not working in the UK?
The upshot was that, in general, where an employee was not working in the UK at the time of their dismissal, they needed to show a “sufficiently strong connection” with the UK and British employment law to enable it to be said that Parliament would have regarded it as appropriate for a tribunal to deal with the claim.
Can a UK subsidiary be a host employer?
Depending on the structure/arrangements, the UK subsidiary may be your host employer for PAYE/NIC purposes – if so, it will have to deal with PAYE/NICs etc. The lack of funds is irrelevant. As you are a director of the UK sub, it seems fairly likely that it could be regarded as a host employer.
Are there any US companies in the UK?
There are thousands of people in the UK working for US companies based in Washington State, including Microsoft and Amazon, and I’d wager that almost none of them are paying their tax in Washinton State, so I have to wonder why you think you will be.
Can a US company pay ni in the UK?
One way around these difficulties would be for you to form a one-person UK corporation and have your US employer pay that as if a contractor, then you can handle UK PAYE and NI from your corporation.
What happens when you hire a foreign employee in the UK?
The emerging trend of hiring employees overseas brings with it the complexity of international payroll . You could find yourself interacting with two different payroll and tax regimes, both at home in the UK and in the host country, depending on the tax residency of the employee.
