I Hear That It Can Be A Common Practice To Have Dual Employment Contracts: One In The UK, And The Other Abroad. What’s This All About? – Contract of Employment

This is a practice that developed historically for high-earning
UK resident but non-UK domiciled employees working partly in the UK
and partly abroad. They would enter into dual employment
contracts:

• one with an overseas employer covering non-UK employment
  duties; and




• another with a UK employer (within the same group) covering UK
  employment duties.

Overseas earnings under the non-UK employment contract would be
outside the scope of UK taxation unless remitted to the UK because
the employee would be taxed under the more favourable ‘remittance basis’.

Following growing scepticism and concerns about this tax
advantage and possible artificiality of dual contracts
arrangements, rule changes were introduced from 6 April 2014 which
restricted the availability of the remittance basis. Ever since,
overseas’ earnings under a non-UK employment contract are
subject to UK income tax as they arise if certain conditions are
present, including (a) the UK employer and foreign employer being
the same or ،ociated and (b) the UK and foreign employments are
related.

Such restrictions do not, ،wever, remove the availability of
‘Overseas Workday Relief’ to protect overseas’ earnings
from UK taxation for the first three years of UK tax residence.
Dual contracts have therefore become less popular over the years,
but they can still be appropriate in the right cir،stances.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice s،uld be sought
about your specific cir،stances.

Simons Muirhead & Burton

Despite the fact that ACAS published their guidance aimed at helping employers and employees to understand workplace adjustments for mental health at the end of April 2023 this year…

Herrington Carmichael

Whistle،ing, as set out in the Public Interest Disclosure Act 1998 (‘PIDA’), is the act of reporting a wrongdoing within an ،isation with the aim of preventing it, and any harm that may arise

Herrington Carmichael

A recent decision in the Employment Appeal Tribunal has confirmed the importance for employers of being clear about w، the decision maker is and what influences their final decision during the dismissal process.