# Remote working in the US from the UK



## ZR33 (Jan 26, 2016)

Hi all,

Firstly thank you for taking a moment to open this post and read through my random story!! I‘m in an unusual position and am looking for advice on who best to contact – not necessarily a full answer as I imagine the solution is quite complicated!

In a nutshell, I'm a UK passport holder but I have all my documents for the US finalised and in-hand (SSN, Green Card etc). My wife is an American citizen and is already established in the US – waiting for me to sort my **** out!!

I’m currently in the UK serving out the notice period of my job before moving. However, my company has now offered me a remote working position based out of the US. As a small/medium sized business, we do not have any precedent for this, but my company are willing to help me research and seek advice. 

With my wife established in the US, I only have to worry about how to deal with receiving my salary (UK or US? Privately or set up a company?) and ensuring I pay the correct taxes (UK and/or US?) and get the best benefits (tax savings? deductibles? building US credit?). In a minefield of tax lawyers and snake oil salesmen, I really don’t know where to begin! Does anyone have experience in this or know of reputable people to contact for help (I don’t mind paying as would rather get it right first time!).

Cheers!!


----------



## Bevdeforges (Nov 16, 2007)

A couple of principles to keep in mind here: "Where" you are working is determined by where you are physically located whilst doing the work. So in your case, you'll be working in the US and thus subject to US labor law - meaning your employer should be paying US payroll taxes on your behalf and withholding and reporting US income tax from your salary. If they're not able to do that (and most smaller companies can't unless they have a US branch or office already set up), you may have to work as a contractor or vendor for them - and that throws a certain level of complication on your side. (Meaning YOU have to pay the taxes, make quarterly income tax estimates and pay the full amount of "social security" tax - called in that case, "self-employment tax")

It might be best to "sleep on it" until you get over to the States and have your Social Security number in hand. At that point, you'll be completely "street legal" and over the jet lag and can do your research for how best to set this arrangement up. Basically, a good CPA or enrolled agent should be able to advise - but it sounds like you'll be getting over to the US just as the accountants hit their busy season. If you can take a short holiday on arrival and start working with the accountants in May or June, you may find them a bit less frazzled.
Cheers,
Bev


----------



## twostep (Apr 3, 2008)

As you have Green Card, SS# and are in the US you can legally work. You are required to file US taxes. The easiest way for everybody may be hiring you as US contractor.


----------



## ZR33 (Jan 26, 2016)

Cool! some great insight here thank you! I am completely "Street Legal" so am good to go, in fact I'll likely head over to the states in the next few weeks to trial how the remote working will work in practice. 

So it's interesting that both replies mention working as a contractor - this is something we've also talked about as a potential solution. In this situation - I would just set up an LLC and hire an expert to do my taxes (at least to begin with?). Any recommended firms? 

I can then ask my company to directly pay my wage into my US bank account?

Sorry for any dumb questions!


----------



## twostep (Apr 3, 2008)

You can go LLC or dab or just sole proprietor. It depends on you and your line of work. For me dba and liability coverage works fine. Quarterly estimated taxes mean signing a check and sticking a stamp on an envelope. Unless you need a CPA anyway a download such as Turbotax works fine.


----------



## Bevdeforges (Nov 16, 2007)

You don't actually need to set up an LLC - you can operate as a sole proprietor or as "self-employed" but if you do, you will have to get set up with the various payroll tax organizations. I only suggest talking to an accountant if you are interested in having someone help you with the accounting/tax side of things. Many accountants will set you up with a simplified system for recording your expenses and all so that it's more or less already organized for tax filings, both quarterly and at the end of the year.

It may depend on just what sort of work you'll be doing, but there is at least the state and federal level for both income and payroll taxes, sometimes city or county taxes related to the business side of what you're doing. There is also the matter of the difference between payroll taxes if you were a regular employee vs. "self-employment" taxes. Generally, if you go from being an employee to being self-employed you want to re-negotiate your pay, since you'll now be responsible for paying the "employer's share" of expenses and taxes. Simplest example of this is US Social Security - normally the employee pays half and the employer pays half. As a self-employed, you pay both halves.

Then, too, you'll have all your office and other expenses to foot yourself - paper, pencils, Internet connection, a new computer every few years, maybe mobile phone, etc. Either you bill the "employer" for these costs, or you charge them a bit more than your old salary was to cover for the extra expenses. Also remember to factor in for things like medical insurance - which you'll have to pay yourself.

It could be worthwhile to talk to an accountant to see if you might want someone to "hold your hand" at least at first as you get used to the reporting and tax systems in the US. Gives you a bit more time to actually do the work you're being paid to do.
Cheers,
Bev


----------



## ZR33 (Jan 26, 2016)

That's some great information there Bev - appreciate the time and the advice! I'm actually an accountant myself haha but in this situation, I would definitely benefit from someone "holding my hand" who is more experienced on the way US finances are handled. Managing my own finances/expenses is not an issue, but making sure I'm covered from a legal and tax point of view is where I'd need most guidance. Would an accounting firm still be my best starting point? I can just google a couple and start making enquiries with them to begin with...?


----------



## Bevdeforges (Nov 16, 2007)

If by accounting firm you mean one of the big international ones, I'd go a bit more low-key to start. Start with a local firm to see what services they can offer. Once you've "checked out" of the UK tax system, it's really just a matter of getting the basics set up and a system in place so that you get the various taxes and all paid as they come due.
Cheers,
Bev


----------



## BBCWatcher (Dec 28, 2012)

I think I agree with all of the above, although I'd like to chime in here that it can be very, very simple (truly) if you want it to be simple. As a general rule it's best not to add complexity absent a compelling reason to do so.

1. If the U.K. company has a U.S. subsidiary or affiliate that can put you on their U.S. payroll, that obviously works. You'd be a regular U.S. employee of a U.S. company. In that case your employer pays half of U.S. Social Security/Medicare payroll taxes (before your wages are even shown on your paycheck), and you pay half (deducted from your paycheck).

2. There is rarely a _requirement_ to have any business structure whatsoever to work as a contractor. No LLC, no dba, no corporation, etc. -- those are all optional. You just pay estimated taxes quarterly, including the Self-Employment Tax.

OK, that said, plenty of people participating in this forum get a little more sophisticated and create an LLC (for example) since there might be tax and/or liability benefits for their particular self employment situation. That said, it's really quite difficult to avoid liability, so I agree with the comment that liability insurance of some type might be a better (or at least also necessary) approach if that's a concern. And as a general rule the U.S. isn't like the U.K. in terms of tax benefits associated with single individual structures -- the U.K. seems to be much more generous in that respect.

So, to net it out, you can keep it very simple indeed, and many or even most people do exactly that. They just perform some work without any company structure, receive some money for that work, report the income, and pay taxes on that income (including estimated taxes) -- all without even hanging a shingle, as it were. And that's all perfectly fine in most cases, including for U.S. state governments with state income taxes.

In terms of _where_ you're paid -- into which bank account -- that doesn't matter much at least on the U.S. side. It's still income, still constructively received. As a separate matter, non-U.S. accounts are reportable via FinCEN Form 114 and/or IRS Form 8938, as applicable. But those are financial disclosure forms for asset control and other similar purposes, not tax forms as such. Presumably you want to start supporting your lifestyle in U.S. dollars since you're living in the U.S. where expenses are all in U.S. dollars, so it'd probably be in your interest to set your compensation in U.S. dollars going forward and for your employer to pay you in that form in some negotiable instrument that means you receive exactly those agreed U.S. dollars. But that's up to whatever agreement you can reach -- you aren't required to do that. If for example you (oddly) want to get paid in Swiss francs deposited in a French bank account, no problem, but you still pay tax (in the U.S., in U.S. dollars) and have to disclose the account to U.S. authorities.


----------

