India employment, working in UK on deputation on Tier 1 ?

[MVaibhav]

hi guys,

Could you please help me get out of this dilemma.

I am currently on WP and applying for my tier-1 (got an appointment for in-person application in june). My current leave to remain expire in first week of july and I am pretty confident that I will get my tier-1 stamped as all the papers etc are in place.

I am looking for a UK based position for a company, having presence in India also. I have two options
1. become a UK based employee for the company's UK subsidiery.
2. join as an India employee and come to UK on deputation.

Due to certain reasons, they are reluctant to give me a UK based employment, so I may have to join them as an India employee and come to UK.

Now, I am not clear if I get the option 2 only (India based employment) then can I actually work in UK on my tier-1 visa or the employer will have to essentially apply for a new WP for me ? in that case, wil my tier-1 be still valid later (if I want to look for any other options in UK, once the economy improves ??) or the new WP overrides the tier-1 visa ?

you may ask me, why I don't let them apply a new WP and forget about tier-1 for now, if I am going to join them as India employee, but the issue is that I am actively looking for other UK based options as well and if something clicks, then I will need my tier-1 (though not much luck so far). Getting an in-person appointment is not easy so I don't want to let my appointment go for waste if I can use my tier-1 for India based employment also.

If this question has already been answered, kindly point me to the posts, I have unable to find any authentic info/personal experiences about the same so far.

Kindly suggest.

Regards
Vaibhav

[aspirant09]

hi,
I think u should go ahead with your appointment and once u obtain a Tier1 Visa u can inform the employer that you have already got a Tier1 visa so u donot need WP.
If the complany applies for your WP which is known as Tier2 nowadays, then your Tier1 visa will no longer be valid.
By using your Tier1 visa u can work for your Indian employer as well as look out for options while u are in the UK.....thats what u want ...isn't?

[MVaibhav]

Thanks a lot for the quick reply. so this is not essential for my new employer to apply a WP. sometimes they would like to do so (even with extra cost) so that employee is bound with them. makes sense for the organization to feel secure. .

But there is no legal issue in me working on Tier-1 being an Indian Employee (not UK employee). Can I get this confirmation from some authenticated source ? Can this be found on some UKBA website/circular ?



The other question arises about the tax implications. If I am deputed in UK, company will pay me salary in India (that is taxed in India), and allowance in UK. The allowance that company pays to employee is non taxable in employee's hand, but I believe that company definilty pays some sort of tax at their end to UK HMRC.

I read somewhere, that as an HSMP/tier-1 holder, the person is suppossed to pay tax as a regular UK worker, is that true and if yes, what kind of implications can it have on my net income (or company's tax implications for that matter). Could this be one issue for companies to force employees to go on WP instead of using existing tier-1 ?

Kindly help.

Regards
Vaibhav

[ChetanOjha]

Vaibhav,
I worked as an employee of Indian Company deputed in UK. I earned in UK/paid in UK/got taxed in UK too. It is perfectly alright to work on Tier 1 visa.
Nobody can force you to switch even if your are employee of some company. Its is a bonded labour...is it?

Thanks a lot for the quick reply. so this is not essential for my new employer to apply a WP. sometimes they would like to do so (even with extra cost) so that employee is bound with them. makes sense for the organization to feel secure. .

But there is no legal issue in me working on Tier-1 being an Indian Employee (not UK employee). Can I get this confirmation from some authenticated source ? Can this be found on some UKBA website/circular ?



The other question arises about the tax implications. If I am deputed in UK, company will pay me salary in India (that is taxed in India), and allowance in UK. The allowance that company pays to employee is non taxable in employee's hand, but I believe that company definilty pays some sort of tax at their end to UK HMRC.

I read somewhere, that as an HSMP/tier-1 holder, the person is suppossed to pay tax as a regular UK worker, is that true and if yes, what kind of implications can it have on my net income (or company's tax implications for that matter). Could this be one issue for companies to force employees to go on WP instead of using existing tier-1 ?

Kindly help.

Regards
Vaibhav

[MVaibhav]

Hi Chetan,

Were you working with your Tier-1 or WP ?

and that is exactly how I am working today (on a WP). Employee of Indian company, deputed in UK/Piad in UK and Taxed in UK.

However, the new employer does not give a salary in UK that is taxable in my hand. I don't know how they pay tax? What ever I will be paid will be in the form of Allowance.

I don't know if I am making sense here. My concerns is If I am working on a tier-1, will that impact my net income (if the company pays me same allowance and I need to shell out the tax/NI etc.) or will my cost to Company increase, beacuse to maintan the same after tax allowance for me, company will have to pay more taX ? (that I doubt they will agree) ..

anyone has any clue/suggestion ?

[ChetanOjha]

I think You should be fine. The only issue you may have is at teh time of extension, when you will have to show your gross salary.

Hi Chetan,

Were you working with your Tier-1 or WP ?

and that is exactly how I am working today (on a WP). Employee of Indian company, deputed in UK/Piad in UK and Taxed in UK.

However, the new employer does not give a salary in UK that is taxable in my hand. I don't know how they pay tax? What ever I will be paid will be in the form of Allowance.

I don't know if I am making sense here. My concerns is If I am working on a tier-1, will that impact my net income (if the company pays me same allowance and I need to shell out the tax/NI etc.) or will my cost to Company increase, beacuse to maintan the same after tax allowance for me, company will have to pay more taX ? (that I doubt they will agree) ..

anyone has any clue/suggestion ?

[MVaibhav]

hmmmm... Thanks for bringing that. I never thought about that aspect .. may have to do some research on this ..

[nksg]

Reading the complete posts i feel you should be fine even taking indian employement. I know people who are working in UK on Indian pay roles got their HSMP extn successfully (Basic salary in India and UK allowances).

All you need calculate the salary required for extn + indian component and if all fits the bill you should be fine...

All the best.

NK

[ChetanOjha]

Agree.

Reading the complete posts i feel you should be fine even taking indian employement. I know people who are working in UK on Indian pay roles got their HSMP extn successfully (Basic salary in India and UK allowances).

All you need calculate the salary required for extn + indian component and if all fits the bill you should be fine...

All the best.

NK