Working remotely in the US for the UK

[LaJumpa 40]

I’m due to be moving to the US in the coming months on a CR-1. 
 

I’m currently employed for a company that operates here in the UK as well as the US. 
 

They’re aware that I’m leaving soon and conversations are beginning about potentially transferring within the company. However, this is subject to a position being available etc. 
 

What is the potential of working remotely for my UK office during the interim if there isn’t a position immediately available? I’m authorized to work in the US but I’m interested to know what potential tax implications there could be? Is it worth the hassle or is it better to take on a temporary job and then switch to my US office once everything is good to go?

 

Im sure an internal transfer will go ahead, but I’m just working on a back up plan just in case!

 

Has anyone had a similar experience?

[JeanneAdil 6,562]

• UK and US are party to the tax treaty  and you don't pay to both countries

it gets more complicated when u work for US company part of the year and UK the other part

then ,  u should hire a good certified accountant for that year's returns/   not H&R Block or online preparer 

 

If the UK company works u under the US tax system ,  you would be paying into SS, medicare , federal and state taxes here

[Pinkrlion 2,724]

You are a CR-1. You will have your green card stamped in your passport. You are fine to work. 

[Boiler 45,676]

To our CPA will sort it out presumably you will be self employed 

[Mike E 11,741]

7 hours ago, Yellowcab1111 said:

What is the potential of working remotely for my UK office during the interim if there isn’t a position immediately available? I’m authorized to work in the US but I’m interested to know what potential tax implications there could be? Is it worth the hassle or is it better to take on a temporary job and then switch to my US office once everything is good to go?

If they pay you as a contractor based outside the USA and don’t deduct UK or any country’s taxes form your pay, then this is Simone and imho you don’t need spend thousands of dollars per year on a CPA:

 

* you report your income to the IRS as a self employed person. This entails  filing schedules C and SE with the rest of your IRS tax return.

 

The only complicated part is the foreign exchange if they pay you in £ to a UK bank account:

 

* you will have to report any interest the money earns in the UK. I suggest getting a non interest bearing account 

 

* if money is deposited on day X, you might have to wait to have it e-transferred to your U.S. account. During that time the foreign exchange rate will change. So you will have  number of small short term capital gains and losses to report. 

 

 

 

[LaJumpa 40]

4 hours ago, Mike E said:

If they pay you as a contractor based outside the USA and don’t deduct UK or any country’s taxes form your pay, then this is Simone and imho you don’t need spend thousands of dollars per year on a CPA:

 

* you report your income to the IRS as a self employed person. This entails  filing schedules C and SE with the rest of your IRS tax return.

 

The only complicated part is the foreign exchange if they pay you in £ to a UK bank account:

 

* you will have to report any interest the money earns in the UK. I suggest getting a non interest bearing account 

 

* if money is deposited on day X, you might have to wait to have it e-transferred to your U.S. account. During that time the foreign exchange rate will change. So you will have  number of small short term capital gains and losses to report. 

 

 

 

Thanks for a detailed response! Its something to consider as a back up plan.

[Sofitalian 134]

I had similar experience. When filing tax in US, I had to file my income earned from the contract as self-employment income. I used the currency exchange rate specified by IRS for that year to convert the amount into USD.

 

As for the home country, I'm not sure if you need to perform tax clearance before leaving UK. In my case, I had to clear all my taxes. So I started a new contract after I moved to the US, to make things simpler. Since I worked remotely from the US for this contract, and I didn't live in my home country hence no tax residence there, I didn't need to file tax for the income in my new contract.

[JeanneAdil 6,562]

13 hours ago, Mike E said:

If they pay you as a contractor based outside the USA and don’t deduct UK or any country’s taxes form your pay, then this is Simone and imho you don’t need spend thousands of dollars per year on a CPA:

 

* you report your income to the IRS as a self employed person. This entails  filing schedules C and SE with the rest of your IRS tax return.

 

The only complicated part is the foreign exchange if they pay you in £ to a UK bank account:

 

* you will have to report any interest the money earns in the UK. I suggest getting a non interest bearing account 

 

* if money is deposited on day X, you might have to wait to have it e-transferred to your U.S. account. During that time the foreign exchange rate will change. So you will have  number of small short term capital gains and losses to report. 

 

 

 

Self employed persons are suppose to pay quarterly into IRS for federal ,  state ,  SS and medicare with schedule 1040 ES

https://www.irs.gov/businesses/small-businesses-self-employed/estimated-taxes

[Mike E 11,741]

Estimated taxes are a complex topic. Happy to lecture on that if OP or anyone else has questions. 

[MIRN 2]

On 3/6/2023 at 7:28 PM, Mike E said:

Estimated taxes are a complex topic. Happy to lecture on that if OP or anyone else has questions. 

That would be great. I'm in the same situation. German company wants to continue with me and asks me to run the US department as a one man show. I have no idea how to set this up. I am grateful for any help you can give me.

[Mike E 11,741]

2 hours ago, MIRN said:

That would be great. I'm in the same situation. German company wants to continue with me and asks me to run the US department as a one man show. I have no idea how to set this up. I am grateful for any help you can give me.

 

[Bill Oxner 18]

On 3/6/2023 at 12:17 PM, JeanneAdil said:

Self employed persons are suppose to pay quarterly into IRS for federal ,  state ,  SS and medicare with schedule 1040 ES

https://www.irs.gov/businesses/small-businesses-self-employed/estimated-taxes

I have never paid quarterly and been self employed for 25 years

 

I just pay whats due each year

[Bill Oxner 18]

On 3/6/2023 at 3:07 AM, Yellowcab1111 said:

Thanks for a detailed response! Its something to consider as a back up plan.

I would set up a LLC and or S-Corp and work with your CPA for your taxes. I suggest hire an attorney to set up your LLC/S-Corp they only charge around 1K USD.

 

I wouldn't pay taxes on your full salary since it's like 15 to 20% if self employed, have you business take the burnt of the income and pay taxes on that part at a much lower rate.

 

This is how most professional service companies are set up for tax purpose.  

[TBoneTX 45,550]

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