{"id":16969,"date":"2016-06-23T10:54:24","date_gmt":"2016-06-23T15:54:24","guid":{"rendered":"http:\/\/panamaadvisoryinternationalgroup.com\/blog\/?p=16969"},"modified":"2016-06-23T10:54:24","modified_gmt":"2016-06-23T15:54:24","slug":"where-do-astronauts-pay-tax","status":"publish","type":"post","link":"https:\/\/panamaadvisoryinternationalgroup.com\/blog\/where-do-astronauts-pay-tax\/","title":{"rendered":"Where do astronauts pay tax?"},"content":{"rendered":"

\"tim<\/a><\/p>\n

AES International put out this interesting article.<\/p>\n

Tim Peake landed safely in Kazakhstan on Saturday 18th<\/sup> June.<\/p>\n

After a mind-bending mission 250 miles above us on the $150,000,000,000 International Space Station, we all welcome him back to Earth with much admiration.<\/p>\n

Now with an extra 71 million miles under his belt, Tim is undoubtedly a global expat\u2026<\/p>\n

Interestingly, Tim orbited the Earth 16 times per \u2018day\u2019, but technically visited no specific country for the most part of his journey, given that sovereign airspace doesn\u2019t extend into space.<\/p>\n

This begs the question\u2026<\/p>\n

One which I am sure has been on Tim\u2019s mind.<\/p>\n

More than any other whilst also figuring out how best to capture the Aurora Borealis on his iPhone and wow his HUGE Twitter following.<\/p>\n

 <\/p>\n

\"Do_Astronauts_Pay_Tax.jpg\"<\/p>\n

\u201cIs this a tax-free environment?\u201d<\/strong><\/p>\n

Tim still hasn\u2019t returned to the UK, in fact he\u2019s undergoing tests in Germany (we can only assume his residency status will be among the first).<\/p>\n

So will he pay tax on his \u2018overseas earnings\u2019?<\/p>\n

This depends very much on how his work and living arrangements this tax year sit in regard to the UK\u2019s Statutory Residency Test (SRT) updated in late 2015.<\/p>\n

Much like any prudent expat, Tim very likely had one eye on the HMRC website as he made final preparations for blast off.<\/p>\n

Having worked outside of the UK for 186 days, there may be an upside for Tim as he won\u2019t be caught by the \u2018183 day\u2019 residency test (although perilously close).<\/p>\n

So what questions will the diligent taxman be asking?<\/strong><\/p>\n

Has Tim worked a \u2018full-time contract of employment abroad\u2019?<\/p>\n

Has he been occupied in a \u2018relevant job on board a vehicle, aircraft or ship’ making ‘cross-border’ trips?<\/p>\n

This depends on your definition of whether the ISS is a \u2018structure\u2019 or a \u2018vessel\u2019.<\/p>\n

But \u2018cross-border\u2019 \u2013 not according to his passport we assume.<\/p>\n

Rather like a houseboat (with rocket boosters), we give Tim the benefit of the doubt and make the reasonable assumption that the ISS is a structure \u2013 the \u2018benefit of the doubt\u2019 in this case being greatly helped by the fact that Tim is\u00a0a heroic British astronaut.<\/p>\n

So is the ISS his \u2018home overseas\u2019?<\/strong><\/p>\n

Certainly.<\/p>\n

Has Tim worked in a tax efficient environment and does he owe income tax on his earnings?<\/p>\n

Yes, and certainly not*.<\/p>\n

Well played Major Peake.<\/p>\n

*We think.\u00a0 Probably.\u00a0 Quite likely really.\u00a0 Errm\u2026 This does not constitute actual advice!<\/em><\/p>\n

\"Tim_Peake.jpg\"<\/em><\/p>\n

For other expats out there, there are lessons to learn from Tim\u2019s particular situation.<\/p>\n

First, there’s no point now in anyone bragging about their beach villa in the Caribbean or rustic town house in Monaco.<\/p>\n

Everyone has been trumped by Tim\u00a0in any one-upmanship stakes.<\/p>\n

Secondly, it\u2019s very important to have a clear idea of where exactly you wish to be resident \u2013 and plan appropriately.<\/p>\n

In all seriousness, if you wish to retire back to the UK, this will make a significant difference to your pension plans.<\/p>\n

Perhaps you wish to buy property abroad and become resident in a country other than your own.<\/p>\n

In either case you should know what you are likely to be taxed.<\/strong><\/p>\n

We have put together some fairly comprehensive information about what constitutes residency, which taxes expats might be liable to pay and where\u00a0expat\u00a0pensions<\/a> might fit in.<\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

AES International put out this interesting article. Tim Peake landed safely in Kazakhstan on Saturday 18th June. 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