Freelancing UK>Aus
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- rascuache
Just wondering if anyone can advise on the process/legalities/tax implications of freelancing for an Australian client from outside of Australia?
I'm just finishing up a contract in Aus before moving back to the UK in a couple of weeks, but I'm leaving in the middle of a pretty big project which is set to run on for another month or two.
I'd like to offer them my availability to work on a freelance basis if required, but I've no idea on the process of this, and am struggling to find relevant information!
Anyone worked on this basis before? Would love any pointers that y'all can provide!
- yurimon0
Can you work off the books? Just show up get clients and find an online payment method. bam thats it. Cash is best of course.
- rascuache0
Can't really work off the books, no.
- MrT0
I do this the other way (UK work from Aus) and it all just goes to my taxable earnings at the EOFY. Assuming its the same for your situation. It's perfectly legal/acceptable etc.
- petercooper0
Once you've ended your contract with them and moved back to the UK, what you do is register with HMRC as self employed. This primarily involves paying Class 2 NICs of roughly £10 per month (but you can apply for an exemption to these if you earn under a certain amount), filling out a self assessment tax return each year, and then paying income tax and Class 4 NICs from the result of that tax return.
Then all you do is bill the Australian client with an invoice in your personal name and get them to pay you with something like PayPal, direct bank transfer, or any system of you choice (PayPal has a bad rap due to having hundreds of millions of customers but I've used it over 10 years for things like this with no problems). Then you make sure you put aside a quarter or so of what you receive so you can pay those tax bills later on.
One day, you'll get a self assessment tax return notification through the door, you register online, fill out some boxes that say how much you made, and it gives you a bill. You pay the bill and you're done for another year.
- yurimon0
Do you have to pay taxes? Cant you just have them pay you online paypal type account with a bank in cayman islands or something?
- MrT0
It's just income, declare or not like any other but where it comes from doesn't matter so much.
- rascuache0
Cheers for the replies fellas!
I've been a sole trader in the UK for a couple of years, so that side of things is all cool. It's more the legalities for the client that I can't suss out.
The sticky part is that if I don't have an ABN (Australian business number), an Australian client can't claim my invoices/billings as an expense without doing a load of extra paperwork.
I am led to believe that the upshot is a lot of Aussie business won't trade without an ABN because it's so much extra hassle. I'm pretty sure that I can't get an ABN without being either an Australian, or in Australia.
So that's where my knowledge stops! It's not the end of the world if this doesn't happen, and I'll make the offer to them whether I find out or not, but I guess it's more compelling for them if I can approach them with all the facts!
- MrT0
Of course, should've expected more red-tape from the Aus side! Surely if it's just to see out a project rather than for an ongoing/indefinite time, they can overlook your lack of ABN?
- autoflavour0
get paid in gold..
- rascuache0
Yeh it's not quite as simple as I wish it was!
I'm 99.9%he client would absolutely not be willing overlook the lack of an ABN. Sort of organisation where everyone has to be accountable for everything.
- MrT0
This might help... http://www.ato.gov.au/businesses…
- rascuache0
I think this is what I needed to know: