Tax conundrum

As you may have noticed, we moved to Spain at the end of April this year. MrsC has spent much of the intervening time in the UK, carrying on her art business and teaching a summer school (on espionage, as it happens), so she is effectively only here a proportion of the time. I have gone back to translating full time and spend my days in Spain doing my best "Ray Winston in Sexy Beast" impression (it's not a very good one).
As we are in a rather complicated position, I wondered if anyone with knowledge on matters tax could give me a clue?
We have taken advice from a Spanish financial advisor, who suggests that I can/should continue to be registered as self-employed in the UK and to pay National Insurance. However, the advisor went on to say that I should register as resident in Spain and pay income tax here. The further complication is that all my clients are in France and I get paid in Euros into a French account.
Wouldn't HMRC be a little surprised and unimpressed for me to be ostensibly resident (for tax purposes) in Spain, yet still operating as self employed in the UK?
What do you reckon?

It can get a bit complicated, and your tax residence status can be impacted by the amount of time you are in (for example) the UK each year.

However, based on what you've said I think that you will be liable to UK tax on your UK earnings (at the very least - potentially on your earnings in France/Spain).

To add to your considerations, you may also need to register in France, although their tax system, I'm afraid, is well beyond the extent of my limited knowledge.

Hopefully you will be able to claim double tax relief on all of this so that you aren't being taxed two or three times for the same earnings.... but sounds like you need to get yourself an accountant who can advise you properly on these matters.

Well, until I moved here, I was quite correctly taxed in the UK on my earnings from France, as I was tax resident in the UK. I simply used HMRC's own rates to convert my € earnings into GBP and declared it. The amount of time I am physically present in a country does have an effect, but the Spanish financial advisor reckoned it wouldn't be a problem (given that I'd be paying tax in Spain). It would be a lot harder for HMRC to make a claim for my tax if I'm not present in the UK.
I'm just a bit doubtful that I can pay UK NI but not tax...

Wow you like to mix it up Jim, I can't see how HMRC can have a claim on the business income given your euro clients and residency in Spain. I think you do need advice as regards being able to maintain NI contributions etc on a voluntary basis.
I hope it gets sorted out ok

While living here in France i continued paying my NI stamp (minimum rate) until i reached 33years payments so as to get the national basic pension when at whatever age i will be entitled to it.

I know thats not much help Jim but thought it may be of interest.

I have sent you a pm

You can't do this via a forum, it's too complicated. You need an accountant to sit down and guide you through the whole process, including understanding the French and Spanish guidance to ensure you do the best for your short, medium and long term future. Assets (if any!) need to be considered amongst other things.

Thanks, Gents. I appreciate this is not a candidate for a bar-room / forum conclusion, but I thought there might be a straightforward rule on what cases HMRC would deem within their jurisdiction (or fiscal equivalent).

I've taken professional advice here in Spain, but it wasn't wholly conclusive. The search goes on!

This is probably what your accountant was intimating - If you are resident abroad and self-employed, you do not usually pay NI or the equivalent thereof, so you are allowed to may the lower rate in the UK.

If you are resident in Spain and pay tax there, it does not matter where your customers are or where your bank account is, you pay tax on that income earned while being in Spain. Declaring that income is important, not really where it is sitting.

Your wife's situation might be different as she is physically working in the UK and her business is registered in the UK. You may have to continue pay UK taxes for that income unless she can do that work from Spain.

But you may well need a knowledgeable international accountant to get it all set up efficiently.

The main difference between the UK and France and Spain seems to be that there is no exact equivalent to our all-in-one National Insurance. In France there are a plethora of different bodies who all want a slice of your income - health, retirement, training, supplementary this and that, etc. The catch-all phrase is "Social Charges". In France this often accounts for around 40% of your gross income, with income tax on the top (if you exceed the threshold). Or it did, magooagain will know better the current situation.

When I first moved to France, I was self-employed, paying my stamp in the UK. I then got a job with a French company, but - like Joe - continued to pay my self-employed NI contributions for a couple of years as I wasn't sure if I had missed any.

On my return to the UK, I went self-employed again and still have the same UK setup. If I elect to pay tax in Spain, it will be the same situation as in the UK, except I'll have a Spanish declaration, not an HMRC one.

The point is whether either or both systems can cope with someone paying income tax in one country and social charges/NI in another.

Similar in Germany - where there is health insurance, social charges and income tax. If self-employed and living abroad, paying the minimum NI contributions up to 33 years just makes you retain your UK national pension entitlement (as of today's rules). The NI credits will probably not be recognized by another EU nation.

In Germany, the self-employed must pay income tax and health insurance. They are open to partake in the national pension scheme or set up their own cover.

The two systems are not linked. The voluntary contributions are very low, but so will be the pension value when you are of eligible age - just the basic state pension. Paying the voluntary contributions is wise, but it can't be your only pension plan.

The situation in Spain should not be dramatically different in principle as they must all follow EU regs. However, you need to find out the details. You need to find out if you must pay into the Spanish pension scheme, even as a self-employed person. If you do, then those credits will be recognized across the EU and paying voluntary contributions may be pointless.

Next instalment on this; as advised, we queued for 2 hours at the police station in Cartagena this morning to get our "NIE" numbers, which are temporary foreign residence permits, mostly to enable people to buy houses, buy cars and, generally, pay taxes.
However, on returning to the office of the advisors who drove us there, one of the staff asked why we had applied for a number for my stepson. Turns out in fact we need (or at least my stepson and I need) full residents' numbers, not NIEs.
This has a knock-on effect on my decision about my work, but further research (at home on our own) suggests that if I get an A1 (I think) form, it proves I am covered for National Insurance in the UK and am therefore entitled to reciprocal healthcare in Spain. If I can then prove I have a steady income (possibly into a Spanish rather than French account), it should all be OK.

Believe it when I see it...

You may find some good info here Jim http://costacalida.angloinfo.com/

Cheers Joe! Anglo Info has helped me and infuriated me in equal measure over the years, but the Costa Calida franchise is up for grabs I believe.

Yep i constantly get emails from them asking if i am interested buying in to the business.

You should get some help from there though Jim.

Good luck with it.

How about some of your own words DabielTheManual rather than repeating someone else's political claptrap?
Claptrap which has nothing to do with this thread either.

Thanks for that Dan. I think the red mist of your fury at "those faceless European bureaucrats threatening our liberty and the very life of the queen (god bless 'er), bla, bla, bla" must have caused you to post on the wrong thread.
Regardless of my residency status, I don't think it makes me liable to arrest just yet. Or does it...? (No. It doesn't. Just f**king with you!)

Off you pop to be furious somewhere else, eh?

You can get cream for that! Think its called Imac or the like.

Or possibly germoloids in this case...

Oops, I meant to post this in the Spanish thread!

Methinks PeteP still has a bee in his bonnet

No I don't, I simply believe that quoting someone else's words is ducking the issue.
You have a brain, so why not show that you can use it.