Tax Residency and Income Tax Treatment of the spouse of a crown servant on posting abroad

Hi, I am the spouse of a crown servant going on a posting abroad later this year (the posting is in an EU country). I have found the guidance online re: crown servants' tax residency status, stating that they will be treated as if they reside in the UK during their posting: "If you work abroad as a crown servant, you pay Income Tax in the UK on income from your job for the Crown as if you live in the UK. The rules apply regardless of your UK residency status for tax, no matter how long you’re abroad, where you work or how settled you are." However, the guidance doesn't mention if this rule extends to the spouses. For context, I am employed by a UK based entity and have a chance to continue to work for them as I am already working on a remote basis, so my location is not relevant in terms of work requirements. I would like to be able to tell them tax implications of this move, if any, to help them decide and hopefully be able to retain my job. I tried the helpline but they didn't have information available on this specific case concerning crown servants' spouses. My questions are: 1. As the spose of a crown servant abroad, will my UK employment income (paid by a UK entity into a UK bank account) be taxed as if I am still a UK resident? 2. Is there anything I need to do besides the standard posting process to let HMRC know that I will be living abroad but continue to be employed in the UK? 3. Will my UK employer need to do anything differently during this time? It will be a 3 year assignment so spanning over 4 tax years, first one and last one being partial.

Hi,
If the spouse is not a crown servant, then they are treated as being non UK resident for tax purposes.  
Any income / capital gains arising while overseas would be taxable in the other country of residence, provided there is a tax treaty between the UK and that country.  
You will find the list of tax treaties at:
Tax treaties

Hi, Thank you for your quick response. My presence there in our posting location will be based on a diplomatic passport, so I will only be there because I will accompany my spouse who is the crown servant. And my income will be made in the UK, paid by a UK entity and into a UK bank account. Does this change anything or does your response still apply to our case? I will not have any income in Hungary. This is what the tax treaty says so I am a bit confused comparing this with the response above, maybe I am misinterpreting something? "Where a resident of Hungary derives income which, in accordance with the provisions of this Convention, may be taxed in the United Kingdom, and is so taxed in the United Kingdom, Hungary shall, subject to the provisions of sub-paragraph (b) and paragraph (4), exempt such income from tax." Does it have any implications on my employer or is the impact limited to me & my personal tax residency and self assessment?

Hi Asli Kaya,
Please have a look at the tax treaty the UK has with Hungary.
As you are not a UK crown servant, your UK employment income will be taxable under article 14.
Article 14 advises that UK employment income, which is not arising from directors fees, pension, government service or from lecturing or research, is taxable only in the state that the employment is 'exercised'.
As you are in Hungary while 'exercising' this employment, it is taxable only in Hungary.
It is only your spouse's employment income that will remain taxable in the UK as it is arising from government service.
Thank you. 

Thank you for your reply, that part is clear. I am still unclear about the implications to my employer though, as I understand so far there is some paper work for this to be processed properly and I am treated as a temporarily overseas UK-employed worker but hard to understand if there are any other burdens on the employer - or whether the real burden is on me as I will initially pay double tax and claim tax credit form the UK if applicable and do the relevant paper work too. Can you please guide me towards what the employer needs to do; they are not headquartered in the UK so I want to be clear on the process with them to make sure nothing gets missed. Sadly this is not a guidance I was able to find online. Thanks again, 

Name removed admin .

Not HMRC...no you cant claim tax credit...as HMRC stated, if exercised in Hungary it is taxable ONLY in Hungary, that means no UK tax should be deducted because it is not liable in the UK in that situation, to re-iterate, you CANNOT claim tax credit in any country in respect of any employment where the DTA says it is assessable ONLY in another country.

Hi ,
 

Your employer wont do anything. It will be you who is liable to pay the tax on your income in the other country . Thank you .