As the owner of a company, working in the offshore sector, I have had to look into this quite a lot recently.
I just wanted to warn ROVworld members to be aware that more countries are starting to enforce ‘withholding tax’ on the employers at the source country of operations. In turn the employers deduct that tax from the employee’s/contractors salary/invoice at source. (We have already seen one recent thread on this topic).
If you are having tax withheld by your employer then you should ask for proof from the employer that indeed that tax is being passed on to the relevant tax authorities. If anything, it will be proof that you have paid tax somewhere on income, should you ever need such proof.
I’m not surprised this is starting to happen given the fiscal problems countries have had over the last couple of years. They are all on the hunt for increased tax revenue. Some countries are achieving this more rapidly than others.
I note of late that Holland is starting apply high National insurance to any persons working offshore in Dutch waters.
Reciprocal tax agreements can sometimes ensure gross rates are paid at source, but that scenario is increasingly needed to be supported by a document completed by the tax authorities in your country of residence to show that you are indeed registered for tax somewhere.
Expect things to get tighter on the tax front over the coming years.
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