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Moving from Spain to UK
Thread poster: Lucy_Fleming
Lucy_Fleming
Spain
Local time: 03:57
Spanish to English
Sep 14, 2009

Hello everyone,

I have been working as a freelance translator (Spanish into English) for about a year and a half and have managed to get a good handful of constant clients during this time. I am however planning to move back to the UK and would like to know how to hang on to these clients that it’s taken me so long to find! To make it clearer:
- Can anyone tell me how I would invoice a Spanish client if I am based in the UK? Despite being British, I’m not sure how the tax system works there since I moved to Spain straight after graduating from university. I currently have to add 16% VAT and apply 7% IRPF, so how would this change if I were to be living outside of Spain?
- How easy is it for a Spanish client to pay into a foreign (ie. UK) account? I currently have an HSBC account in the UK.

Any other pointers would be greatly received! Thanks in advance for all you help, Lucy.


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Mary Lalevee  Identity Verified
United Kingdom
Local time: 02:57
French to English
Tax etc Sep 14, 2009

Hi Lucy,

I moved from France to the UK in 2001 and faced similar problems. It is incredibly easy to get organised here.

You have to declare that you are self-employed wihtin 3 months of starting work and you can do this by phone(!). You have to pay approx £10 a month National Insurance. You only have to apply VAT if you earn over £50,000 per year. The Inland Revenue - now called HM Revenue and Customs - were extremely helpful and organise seminars for people starting out here. Well worth attending as they explain how to keep accounts here.

I bill my clients in France in euros without VAT, with a note on the invoice to this effect, and they pay me by bank transfer to my UK bank account which is in GBP. However, I work mainly for one client and they pay me once a month so these are relatively large amounts. Other people have different ways of doing things.

Good luck!

Mary


[Edited at 2009-09-14 13:00 GMT]


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Angela Dickson  Identity Verified
United Kingdom
Local time: 02:57
French to English
+ ...
bank accounts Sep 14, 2009

Lucy_Fleming wrote:
- How easy is it for a Spanish client to pay into a foreign (ie. UK) account? I currently have an HSBC account in the UK.


Hi Lucy,

I can't help with most of your points, as I've never lived in Spain, but I would recommend that you keep a bank account in Spain and get your Spanish clients to pay into it. Then you can transfer money from Spain to the UK when you need to, and bank charges remain under your control. I keep an account in France and a transfer only costs me EUR 3.50.

You need to keep track of incoming money somehow - I note how much the invoice is in euros, then apply the prevailing exchange rate on the date the money comes in, so I know how many pounds sterling to list as income. I have been told by someone from HMRC that it doesn't particularly matter how you do this, so long as you can justify your method and so long as you are consistent.

[Edited at 2009-09-14 14:06 GMT]


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John Rawlins  Identity Verified
Spain
Local time: 03:57
Spanish to English
+ ...
Simple but strict Sep 14, 2009

I have been self-employed in both the UK and Spain.

If you only have experience of the Spanish approach to taxes and administration, then you will be shocked at how easy everything can be in the UK. You will immediately notice that most regulations are written in very simple English and there are no 'gestores'.

However, remember that the consequences for 'dodgy' practices in the UK can be very severe. People in the UK go to prison for not paying their VAT or income taxes. You must also be careful what you say to your own accountant, in case he is then legally obliged to denounce you to the taxman. Spain has not yet reached this point.

[Edited at 2009-09-14 14:05 GMT]


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Lawyer-Linguist  Identity Verified
Portugal
Local time: 02:57
Dutch to English
+ ...
Current threshold Sep 14, 2009

Mary Lalevee wrote:

You only have to apply VAT if you earn over £50,000 per year.


I believe the current threshold for VAT is actually £68,000.


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Lucy_Fleming
Spain
Local time: 03:57
Spanish to English
TOPIC STARTER
a few more questions Sep 14, 2009

Thank you everyone for your kind responses.

Mary, thanks for letting me know about having 3 months to register in the UK. I wonder, does that mean that on my invoices I would literally just put my name until I am fully registered (in Spain one has a National ID number as a reference). Sorry to be so clueless!

I actually only plan to continue working as a freelance until I find a permanent office job (the horror!) as I envisage my expenditure increasing considerably, thus requiring a more steady income... presumably I could do this even if it was only for a couple of months ie. just checking there are no big fees to pay that would make the whole exercise pointless?

Thanks once again for all your thoughts and insights,
Lucy


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Mary Lalevee  Identity Verified
United Kingdom
Local time: 02:57
French to English
No big fees Sep 14, 2009

The only things you have to pay are your tiny National Insurance contributions and tax at the end of the year - that's it! Amazing for those of us who have lived in other countries where it is extremely complicated to work freelance.

You can also work freelance and have a salaried position at the same time.

Yes, you need only put your name and address on the invoice. I also include the following :

Not liable to VAT
UK National Insurance no. xxxxxxxxxxxx
Tax reference no. xxxxxxxxxxxx

But none of them is required.

However, I suggest you look at the HMRC website for completely up-to-date info.

Good luck!
Mary


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Russell Jones  Identity Verified
United Kingdom
Local time: 02:57
Italian to English
Some resources Sep 14, 2009

Hello Lucy

Welcome to this forum. I have been following the topic but was too busy to reply earlier.
A useful starting point is: http://www.hmrc.gov.uk/selfemployed/ which tells you how to register as self-employed and for National Insurance.

Here is a selection of recent discussions on the subject in the Money Matters forum:

http://www.proz.com/forum/money_matters/142937-invoicing_foreign_customers_from_the_uk.html

http://www.proz.com/forum/money_matters/139522-client_id_numbers_on_invoices.html#1166639

http://www.proz.com/forum/money_matters/132305-irpf_withheld_from_us_translator_invoice_can_i_get_a_refund.html#1099850

http://www.proz.com/forum/money_matters/127076-invoicing_from_uk_to_spain.html#1050248

I was trying to find one in particular, in which a Spanish agency refused to accept a UK based translator's invoice without a VAT number or insisted on witholding tax, despite being given chapter and verse on the regulations. They were just not prepared to vary their standard practices. I couldn't find it easily I'm afraid.

Hope that helps; good luck.

[Edited at 2009-09-14 15:51 GMT]


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Peter Linton  Identity Verified
Local time: 02:57
Member (2002)
Swedish to English
+ ...
HSBC euro account Sep 14, 2009

Lucy_Fleming wrote:
- How easy is it for a Spanish client to pay into a foreign (ie. UK) account? I currently have an HSBC account in the UK.

Easy, and particularly so if you have an HSBC euro account, in addition to your sterling account. Because of EU rules, it is cheap and simple to transfer money between euro accounts within the EU. The fact that your customer is in Spain and your euro bank account is in England makes no difference. I have a similar arrangement here with my local branch of Barclays Bank.

In your case, there are further advantages:

If you are not resident in Spain, you may find it difficult to open an account there, and to manage it remotely. Banks these days tend to be very suspicious of non-resident customers.

It is easy to transfer funds between an HSBC euro account and an HSBC sterling account. For reasonable sums you will also get a very competitive exchange rate.

If and when you no longer need your euro account, it will be much easier to close it down in the UK rather than having to travel to Spain.

Your first step - investigate an HSBC euro account.


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Rebekka Groß  Identity Verified
Local time: 02:57
English to German
bank accounts Sep 14, 2009

Angela Dickson wrote:

Lucy_Fleming wrote:
- How easy is it for a Spanish client to pay into a foreign (ie. UK) account? I currently have an HSBC account in the UK.


Hi Lucy,

I can't help with most of your points, as I've never lived in Spain, but I would recommend that you keep a bank account in Spain and get your Spanish clients to pay into it. Then you can transfer money from Spain to the UK when you need to, and bank charges remain under your control. I keep an account in France and a transfer only costs me EUR 3.50.

You need to keep track of incoming money somehow - I note how much the invoice is in euros, then apply the prevailing exchange rate on the date the money comes in, so I know how many pounds sterling to list as income. I have been told by someone from HMRC that it doesn't particularly matter how you do this, so long as you can justify your method and so long as you are consistent.

[Edited at 2009-09-14 14:06 GMT]


Hi Lucy

I personally wouldn't keep a Spanish bank account. The Spanish client can pay directly into a UK bank account and since the banking fees were abolished within the EU you should not have to pay any commission. Of course, there is the exchange rate to consider, which at the moment is rather favourable for us in the UK.

I have more clients in EU countries that pay in Euros (Germany, Italy, Hungery etc.) than UK clients and couldn't have a separate account in each country but I don't pay any commission for funds being credited from the Euro clients.

Having one account makes your accounting much easier, IMO, and it's easier to keep track of the payments. One of my translator friends uses Translation Office 3000 to do her accounts and says she always know what amounts are due and when. At the moment, there is a TGB here on ProZ.com offereing that latest TO3K at half price - I'm considering getting a copy myself.

[Edited at 2009-09-14 16:16 GMT]


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Marijke Singer  Identity Verified
United Kingdom
Local time: 02:57
Dutch to English
+ ...
Spanish bank account Sep 14, 2009

Rebekka Groß wrote:

I personally wouldn't keep a Spanish bank account. The Spanish client can pay directly into a UK bank account and since the banking fees were abolished within the EU you should not have to pay any commission. Of course, there is the exchange rate to consider, which at the moment is rather favourable for us in the UK.



This is not true. Fees have not been abolished. You pay what you would normally pay at the bank for national transfers. I have a bank account in Spain, the Netherlands and the UK (HSBC sterling account). I transfer money from the Netherlands to the sterling UK account (and this is free although the exchange rate is slightly less advantageous) and I also transfer from the Spanish bank account to my UK sterling account (fee incurred). I would definitely keep the Spanish bank account since it makes it easier for your Spanish customers and you want to keep them. This will ensure that nothing changes on your invoice except your address and tel. no. If asked for your VAT number, explain that this is not necessary unless you earn above a certain treshold and use your inland revenue number instead.

Good luck! You are very welcome to contact me privately if you need more assistance. I live near Oxford.


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xxxLia Fail  Identity Verified
Spain
Local time: 03:57
Spanish to English
+ ...
I think I'll pack my bags! Sep 14, 2009

John Rawlins wrote:

If you only have experience of the Spanish approach to taxes and administration, then you will be shocked at how easy everything can be in the UK.



Everything that directly or indirectly involves the civil service is a potential nightmare. On Monday, I couldn't see my doctor (3 weeks waiting list), so had to see a substitute, who gave me information I could have gotten over the phone if someone had pulled their finger out, then I spent an afternoon yo-yo phoning.

Same palaver with the Soc Seg: 3 personal visits to 2 different offices, 2 failed attempts through the website, 2 failed calls, another office visit, finally another call ... and this time it worked. (I've learned that it sometimes works to call back a call centre and try to get someone else, as they simply often give out the wrong information).

As for water and electricity companies, this just wasn't my summer. Three times I asked the water company to stop sending warnings but to enter my bank account number, three times I asked the electricity company to change the contract holder's name ....

Sorry for the rant, but honestly, does everything have to be so unnecessaily complicated and imply a huge measure of time-wasting and soul-destroying effort?


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John Rawlins  Identity Verified
Spain
Local time: 03:57
Spanish to English
+ ...
Rant time Sep 14, 2009

Lia Fail wrote:

Sorry for the rant, but honestly, does everything have to be so unnecessaily complicated and imply a huge measure of time-wasting and soul-destroying effort?


But Lia - you already know the answer. Spain has very high unemployment (officially 18.6 per cent). If every government and utility worker 'pulled their fingers out' then unemployment could easily double.


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Russell Jones  Identity Verified
United Kingdom
Local time: 02:57
Italian to English
The grass may look greener Sep 14, 2009

Lia Fail wrote:

I think I'll pack my bags!



Let's not pretend we don't have appalling service from some utility companies, official bodies and public services in the UK. It's just that, mostly, they don't get in the way of earning a living.

Oh, and the grass is greener - for a reason!

[Edited at 2009-09-14 22:28 GMT]

[Edited at 2009-09-14 22:28 GMT]


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Claire Cox
United Kingdom
Local time: 02:57
French to English
+ ...
Definitely keep your Spanish bank account Sep 15, 2009

Marijke Singer wrote:

I would definitely keep the Spanish bank account since it makes it easier for your Spanish customers and you want to keep them.


Yes, I agree; I'm charged a flat rate by my UK bank (NatWest) for payments in from the Eurozone (£7 for over £100 or £1 if under) but as I invoice monthly, that's just about OK. I have tried other banks, notably Abbey some years ago, but after saying they wouldn't charge commission, I ended up paying over £20 on one transaction as the charges "were levied by their intermediary"! It may not be the same nowadays since they're part of Santander, but it seems such a palaver to have to move your account before you find out and none of the banks seems prepared to give you a straight answer!

I do know that my parents, who are UK residents, have an account in Spain as they inherited an apartment there some years ago and it was easier to open a Spanish account to pay all the bills, than transfer the money from the UK. Even though they've now sold the apartment, they find it really useful to keep the account open for when they travel abroad. There don't appear to be any problems maintaining the account there even though they're no longer even part-time residents.

In your case, it would give you flexibility and help you maintain your existing clients - much easier to keep it open, than close it and find you need to open an account later.....

All the best,

Claire


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