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Where Taxpayers and Advisers Meet

Complicated double taxation?

Thedoc
Posts:1
Joined:Wed Mar 10, 2021 5:57 pm
Complicated double taxation?

Postby Thedoc » Wed Mar 10, 2021 6:21 pm

Hi,

I am a UK national and work for a Norwegian company with an office registered in the UK, so all employment income and tax due is summarised on my P60.

As part of my employment I sometimes have to travel to the Norway office (15% overall roughly) and this is where the trouble starts...

My company (after the fact) informed me that due to my travels they had enrolled me into the Norwegian tax system - not an issue as such until they explain how they tell the tax authorities there about my "earned" salary.

What they did was take my UK annual salary, pro-rate based on days in Norway, converted it to Norwegian NOK and submitted that as salary which then created a tax liability.

The issues with this are, they did not factor my UK salary down to account for the time in Norway so I've paid UK tax on 100% of my UK salary (which I do actually receive) and tax on a notional salary which i never get paid.

I think this is a really stupid idea and the HMRC are struggling to understand why they have done this. I can see this is double taxation, but the self assessment form doesn't seem to cover this as it only covers foreign income which this technically isn't. So as my P60 details already appear in my return automatically with my full salary, if I add a foreign income the system will think I've earned more than I have creating a further tax bill rather than a refund.

I am really puling my hair out with this as it covers 4 years and I'm waiting for a call back from the HMRC, but any comments or experiences that would help me understand would be appreciated.

Sorry if it isn't overly clear!

darthblingbling
Posts:698
Joined:Wed Aug 02, 2017 9:09 pm

Re: Complicated double taxation?

Postby darthblingbling » Thu Mar 11, 2021 6:42 pm

They need to report a notional income through the Norwegian payroll for the purposes of reporting said income to the Norwegian authorities and pay withholding tax. This is pretty standard.

You're UK tax resident, so you pay tax on your worldwide income, you don't just factor out non UK workdays (unless you're non Dom and claiming OWR or something)

For example, if you're paid £100k
£15k is declared as a notional salary in Norway via their payroll
Let's say £5k is due on this income in Norway
On your UK return you report £100k as normal. But you'd also report that you're being doubly taxed on £15k of this income and have paid £5k of tax in Norway via SA106
Depending on the software it should then spit out the FTC as a deduction against your UK tax liability.


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