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THE BENEFITS OF BEING A CONTRACTING EXPATRIATE

The Benefits 

  • High wages
  • Tax free income
  • Free travel, food and accommodation
  • Holidays away from / with the wife
  • Tax free shopping (Retail Export Scheme)
  • Booze and tobacco runs -
    (OK its not just an expat perk, but it's worth a mention)

The Downside

  • Divorce rate is one of the highest
  • Pensions / ISA / shareholding eligibility
  • Lack of continuous contracts overseas

 

The Benefits of being an Expat.

High wages

The ideal expat is obviously someone who is capable of doing his / her job, but also has experience of having done it in many different ways (including occasionally the correct / easiest way), and has a track record of overseas work, and so is unlikely to return home early, from being homesick, or the partner being lonely, etc. This helps to reduce the field somewhat and normally results in a premium wage.

The Americans are paid handsomely (by our standards), TCNs are paid very poorly, usually we Brits slot in there somewhere between. British contractors should be able to undercut their American cousins, and have the market to themselves. Unfortunately this isn't universal, are our recruiters guilty of hiding our light under a bushel? Or do the Americans overawe British industry? Whatever, the scene is not ideal.

Tax free income
Sounds good doesn't it, but there are many pitfalls for the unwary, be warned!

All UK employers must deduct National insurance (12%), for the first 12 months, and tax must be deducted, and reclaimed by you later, by completing a self assessment form. (I think mine was the first form completed and handed in on the 6th April, the tax centres are very helpful and do assist you in completing it) In the old days you could work as self employed and hang on to your money, but this loophole has been closed by the IR35.

Hence, option 2, don't work for a UK employer, get paid by the overseas recruiter, blindingly simple and effective.

Option 3 is to be paid by an offshore company, who invoice your UK 'employer', and therefore skirt the taxman, its still legal but not as popular with the UK recruiter, who is still ultimately responsible for your welfare, insurance, travel arrangements, etc. These offshore companies, usually in the Channel Islands or the IOM, happily take about 5% of your wage in commission. Which though a bit steep lets you hang on to the National Insurance that would otherwise be paid at full rate and is lost forever.

Free Travel, food, accommodation
Where else would you find these perks?? (army, navy, air force, prisons....)

Holidays away from the wife
I've been an expat for the past 22 years, with same wife (who's?) if I stay home more than a month she gets on my nerves, and I get on hers, hence marital bliss is to work overseas, as often and as long as possible, (I'd like to mention the honeymoons happening every time I return, but I'm sure that only happens in books and films.)

- and holidays with the wife
To comply with the 90-day tax ruling, if I end up in a civilised job with regular leave, it is often preferable to bring the wife out to the country you're working in. Your employer is often happy to provide an air ticket for the wife in place of your return flight. This keeps the employer happy that you will return, and tickets bought in the UK (especially through the many 'bucket shops') are often cheaper than those that are available overseas, where competition hasn't really caught on in the air industry. Your 'in country' employer / agent can be very helpful in finding suitable hotels and often has a nice corporate discount that can be used, he can certainly name a 'pet' travel agent that won't rip you off too much.