
Ask HN: How are remote developers taxed? - _ao789
Hi HNers,<p>I am a developer in London and I want to move to a remote role working from Portugal. While there are quite a few roles available remotely, I have never quite understood how the taxation works.<p>e.g. If you work for a US&#x2F;UK company and you are based in Portugal (for example), do you pay double taxation or are you only taxed at source&#x2F;destination?<p>Are remote roles then advertised as cost to company or what you will actually get before any said tax?<p>Is there any metric online calculator for this sort of thing?
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mtmail
I've been in that position.

If you work remote (Portugal) for a UK company then you have to file two tax
returns. In each you have to calculate how many days you spend in each country
(being at your employer's office for a meeting counts as UK, best to keep any
flight ticket receipts).

Both countries will determine their share of your total yearly income. Let's
say the UK gets 7%. There is a so called double-taxation-agreement between the
countries which guarantees that you aren't taxed twice on anything. At least
in theory because the UK tax year is April-April and the agreement says you
can't go to court (or what is arbitration?) if the disagreement is below 5%.
In my experience the tax returns have been fair. Your local tax office
(employee) might not know about all the rules and it's not a usual setup for
every tax accountants to be familiar with.

It helps to have a UK tax accountant, even if the split is 99%:1% because as a
non-resident (and non-citizen I presume) you can no longer use the UK HMRC
online tools yourself.

Realistically if you live and work remote in Portugal your split is >90% in
Portugal. It's just more paperwork to file two tax returns. It looks like
Brexit won't bring any changes, positive or negative.

I can't answer how the situation is for the US. I'd say more complicated than
within the EU.

> Are remote roles then advertised as cost to company or what you will
> actually get before any said tax?

Companies advertise the gross payout of a remote role in the same country,
e.g. a London company assumes you're in Birmingham, not in another country.
For the company it's often a special situation for every remote employees in
other countries. For example the company might be required to pay directly
into the other country's health insurance. With requires a company id number
in that country. And that forces them to file taxes, too.

> Is there any metric online calculator for this sort of thing?

With the double-taxation-agreement(s) it's assumed you pay about the same
amount of tax, just more paperwork. Of course in Portugal your health
insurance might be taxed more or less, or pension payments or unemployment
insurance, and the tax brackets for the income tax are different. I've never
seen an online calculator for that.

Unless to move within your current company expect employers to strongly
suggest contract work instead. For them it's easier to receive a monthly
invoice from you. You wouldn't be an employee (could mean no stock options or
other benefits).

