Is income tax due when the work is done, or when it is paid? For example, I do some work for my employer in the 2016-2017 tax year, but they take a while to pay me and I only actually get paid in the 2017-2018 tax year. In which tax year should that income be included - the year when the work was done, or the year it was paid for?
It depends on whether your tax accounting is on an accrual basis or cash basis. The UK government (at least) refers to the former as traditional accounting. In that method of accounting, whatever it's called, you book the income when you invoice the work (that is, when it accrues). If you're paid in the next year, your balance sheet will show the outstanding balance in accounts receivable. Similarly, you book expenses when you incur them, not when you pay them. So if you bought a new computer for your business with a deferred payment plan, you book the entire expense at the time of the purchase, not the time of payment. Cash accounting is simpler. You can only use it if your total turnover from all of your businesses is less than £150,000 annually. You also cannot use cash accounting if your business is a limited company or limited liability partnership, or is on a list of certain types of businesses: Lloyd’s underwriters farming businesses with a current herd basis election farming and creative businesses with a section 221 ITTOIA profit averaging election businesses that have claimed business premises renovation allowance businesses that carry on a mineral extraction trade businesses that have claimed research and development allowance dealers in securities relief for mineral royalties lease premiums ministers of religion pool betting duty intermediaries treated as making employment payments managed service companies waste disposal cemeteries and crematoria For more information about traditional accounting, see https://www.gov.uk/government/publications/how-to-calculate-your-taxable-profits-hs222-self-assessment-helpsheet.
Under German law, yes sure. As long as you keep to all regulations. You have to declare your taxes. This is income, whether it comes from inside Germany or not and whether it is paid into a German bank account or foreign. You have to have a health insurance and likely need to pay into the social security and pension funds. As your employer most likely does not do this for you as a German employer would be required to, you will need to pay both the employee and the employer's part yourself. So yes, if you pay your taxes on it and have health and social security insurance, Germany does not care where the money comes from. Now whether the company in Mauritius is legally allowed to hire and pay you under their law? I have no idea. Please note that filling out all the right forms correctly is not for the faint of heart. And finding out that you did it wrong only years later is painful and costly. Also calculate your costs before you do anything. Paying both parts for your health insurance for example can easily be up to 400€ a month more then a German employee at a German company, so run your numbers. You may be better off being officially self-employed or even incorporated. Just because it's legal, does not mean it's a good idea. Hire a professional to advise you on the economic and bureaucratic side of this.
The company probably owes U.S. and state corporate income taxes because income from services performed in the United States are usually considered "effectively connected" with the United States. The fact that the servers are located in the U.S. is pretty much irrelevant, relative to the fact that the services are performed while located in the United States. I can't think of a single tax case that has ever turned on the location of the servers in a company. Unlike a U.S. company, a foreign company is not taxed by the U.S. on its worldwide income, nor is the individual, a non-resident alien (having an F-1 visa rather than a green card) taxes on the individual's worldwide income. But, a non-U.S. person is still taxed on income that is effectively connected with the United States. Generally speaking income from property is not effectively connected with the United States merely because it is managed by someone located in the U.S., so if the company had owned an apartment in Brazil that it received rental income from, for example, that would not be subject to U.S. taxation. Also income from intangible property (like interest payments on loans or dividends on publicly held stock) is generally not subject to U.S. taxation if paid to a non-resident, non-citizen of the U.S. But, generally speaking, income from the performance of services is taxable in the place where the services are performed. For example, Colorado can impose state income taxes on income earned by a Texas baseball player while playing at a stadium in Denver. The lack of a salary or employee status shouldn't change the fact that the income received by the company from performance of services in the U.S. is effectively connected with the United States. When the owner performs services in the U.S., the company is performing services in the U.S. and so it is subject to taxation in the U.S. Dividend payments from the offshore company probably wouldn't be subject to U.S. taxation in this scenario, but the company itself would be subject to corporate income taxes in the U.S. from the profits it earned from the services performed in the U.S.
Typically it works like this: Sales Tax: Owed in the state that the sale is made (in your case, New York). This is difficult in the internet age with businesses operated with no physical presence in a state. Technically sales (and local taxes) are due depending on where the item that was sold is delivered, so if you shipped an item made in Texas to New York, New York sales taxes would be due on that item. These taxes would be paid to the state of New York. Same for all 50 states. This is a huge burden on small businesses and is not usually enforced. Most small businesses only collect sales tax on items sold to the state that the business is operating from (in your example, you would only collect Texas state sales tax). Income Tax: This is the corporate tax levied by the state that the business is operating in, in this case it would be Texas. Since Texas does not have a state income tax, there would be no income tax. However Texas does have a Franchise Tax that would be due (this is due from all business organized or operating in Texas) The state that the business is registered in may have its own taxes which would be on the income of the business and would be specific to the state that the business is registered in. These can also be in the form of registration fees, annual fees, franchise fees, etc.
If you are given a paid job, and you do the work, then "consideration has been provided", and 1682 will not apply. As to "referral fees" those sound more like kickbacks, but it depends on what, if anything, the person gets for the fee.
Is there any sort of implied expiration date for a contractor's completion for medium size contractor jobs (&lt; $10k)? Absent a provable deadline, the question would be whether the delay is reasonable (or habitual) under the circumstances. The contractor's presumption that he can do whatever he wants regarding unspecified aspects of a contract is inaccurate. Those matters can still be decided on the basis of contract law and/or under principles of equity. See also the Restatement (Second) of Contracts, which is frequently cited by U.S. courts, at §235(2) and §243 regarding non-performance of a contract. Will my verbal complete-by date hold up in lieu of any written complete-by date? It depends on each party's credibility. Proving that he essentially ignored your follow-up requests will make it harder for him to credibly refute your assertion about the verbal deadline. In case none of your follow-up efforts (or none of his responses) are in writing or if he denies that you repeatedly called him, you might want to subpoena his phone service provider --if the matter goes to court-- and file as evidence the resulting production of records.
united-states They thought of that. See IRS Pub 550, page 36: You are treated as having made a constructive sale of an appreciated financial position if you: • Enter into a short sale of the same or substantially identical property, So when you short-sell 1 BTC while still holding 1 BTC, it's taxed as if you simply sold your 1 BTC. This makes sense as the transactions are essentially identical in effect. I don't think it matters that the 1 BTC you held was used as the collateral for the 1 BTC you borrowed. In particular, although short sales are usually reported and taxed as of the date when they close, constructive sales are an exception and are taxed on the date of the constructive sale itself: You must recognize gain as if the position were disposed of at its fair market value on the date of the constructive sale. This gives you a new holding period for the position that begins on the date of the constructive sale. Then, when you close the transaction, you reduce your gain (or increase your loss) by the gain recognized on the constructive sale. So this doesn't help in deferring your taxes.
if you sell less then 25 1oz Maple Leaf gold coins, you do not have to file a 1099-B at the time of the sale. You still have to report the proceeds on Schedule D when you file your income taxes for the year.