How are COL adjustments usually calculated?

[bryantpark]

Aug 11, 2014 8:38:59 GMT -5 RockNVoll said:

Crap, now I'm really worried about my potential tax bill.  I have no idea how I would go about negotiating that since I don't even know if it will be a problem (or how big of one).  On top of no COL adjustment, this could hit my income harder than I expected.

Not to scare you. But you should be. At least for the 9 months you are expat. It is very complicated and no offense to your 1 tax person in London but you know my firm, and how many people had gone before us, and you know the firm they hired out to do the taxes and it was still effed up and dragged on for three years with additional filings and tax credits and random checks we'd get in the mail that they'd say weren't mine. And I really had to just go on blind faith that they did it right. Remember we were tax equalized. So we weren't supposed to pay any increase. Did you ask the guy who's on assignment now what his experience has been? Has he been through a full tax cycle yet?

[bryantpark]

About the col. Our firm just had a standard 90 pound daily stipend while we were expat. Local hires did not get this. We were there when the Gbp/usd was 2:1. Not sure what the stipend is now, though cushy expat deals are harder to come by.

I am happy to ask a few friends who recently just switched to local what their tax experience has been.

[origami]

If you are considered a local employee in the UK will you be charged income tax on your housing and other benefits and not be able to exclude any of it (under UK tax law)? If we paid that by ourselves that would easily push us into the highest tax bracket. And all those benefits basically double our actual income so 40-45% on most of what we earn times 2. We'd barely be able to feed ourselves. I'm concerned that the OP's business isn't concerned. Unless you are not getting housing and other benefits and will basically only be taxed on salary and the moving stipend. In that case I would just hope your current salary is enough to support living in a VHCOL area.

[frlcb]

Aug 16, 2014 6:34:41 GMT -5 origami said:

If you are considered a local employee in the UK will you be charged income tax on your housing and other benefits and not be able to exclude any of it (under UK tax law)? If we paid that by ourselves that would easily push us into the highest tax bracket. And all those benefits basically double our actual income so 40-45% on most of what we earn times 2. We'd barely be able to feed ourselves. I'm concerned that the OP's business isn't concerned. Unless you are not getting housing and other benefits and will basically only be taxed on salary and the moving stipend. In that case I would just hope your current salary is enough to support living in a VHCOL area.

I agree with this. I know that this is a great opportunity but taking it at the expense of giving up a lot of your salary because of complicated tax scenarios by being local instead of an expat seems like it doesn't make this worth it. Doing UK-US taxes is very complicated.