What makes construction & contracting different from an ordinary filing?
Construction has its own permanent-establishment provision keyed to project duration, and subcontracting arrangements are aggregated in ways that surprise groups who thought each contract stood alone. An ordinary preparer applies the general rule and stops there, which is how the relief in the specific provision goes unclaimed.
Can you work with my existing accountant?
That is how most of these engagements run. They keep the domestic file, we take the cross-border piece, and the boundary is agreed in writing so nothing is done twice or missed.
When does a building site abroad become a taxable presence?
Construction is treated differently from ordinary business activity. Instead of asking whether you have an office there, treaties generally ask how long the site lasted: a building site or installation project becomes a permanent establishment once it continues beyond the duration the treaty specifies, and below that it is not one, however much revenue the contract produced. The threshold sits in the particular treaty and differs between them, so the same project can cross in one country and not in another. The practical consequence is that the clock is a question of record — mobilisation dates, site diaries, handover certificates — and those records are usually kept by people who have no idea they are tax evidence.
Do the months our subcontractor spent on site count towards our own?
Often yes. Time spent on the site by subcontractors is commonly attributed to the main contractor, on the reasoning that the general contractor is present through whoever is carrying out the work under its contract. So a group that mobilised for a short window can still cross the duration threshold because a specialist trade stayed on long after its own people left. Treat the site as one timeline rather than your timeline: from the first day anyone working under your contract set foot on it to the day the last remedial work finished. Ask subcontractors for mobilisation and demobilisation dates as a contractual deliverable, because they will not volunteer them and will not keep them long.
Our project ran longer than planned — do we have to file there now?
Probably, and from the beginning rather than from the day it crossed. Once a project exceeds the treaty duration, the permanent establishment is generally treated as having existed from the start of the site, not from the moment the threshold was passed. The filing therefore covers the profit attributable to the whole project, and the accounting has to be reconstructed for months that were treated at the time as needing nothing. That reconstruction is the expensive part — not the tax itself, but rebuilding cost allocation, payroll attribution and intercompany charges after the event. Where an overrun is foreseeable, start keeping the records a permanent establishment would need while the project is still running.
Do separate contracts on the same site get added together?
They can be. A site is looked at as a whole, so a series of contracts covering work on one physical site is generally treated as one project even where each was signed separately and each on its own would have been short. Dividing a contract between group companies so that no single piece crosses the threshold is precisely the arrangement the aggregation reasoning exists to defeat, and connected-party contracts on one site tend to be added together. Genuinely unrelated projects, for different clients in different places, stay separate. The test is commercial and geographic coherence rather than paperwork, so the question to ask about any split is whether it would have been done that way if tax had never been mentioned.
Our crews rotate between countries each month — who withholds their tax?
Two obligations sit side by side and are regularly confused. The employee's liability depends on where the work was physically done and whether the short-stay exemption in the relevant treaty is available — and one of its conditions fails the moment the employment cost is borne by a permanent establishment in the country where the work is done. The employer's obligation is to operate local payroll withholding wherever that country's law says so, which can arise even where the treaty eventually relieves the employee. For rotating crews that means tracking days by individual and by country every month and reconciling at year end. Reconstructing it later from flight bookings is possible, and it is the most expensive way to reach the answer.
Does preparatory work on site start the clock or does construction?
The clock usually starts earlier than contractors expect. Site preparation — setting out, fencing, clearing, establishing site accommodation — is generally treated as part of the project, so the start date is when work begins on the site rather than when the first structural element goes up. At the other end the site continues through testing and commissioning, and short interruptions for weather, materials or a client's decision do not stop it; the period is normally counted as running through them. Demobilising and returning later to carry out remedial work under the same contract will usually be treated as one continuous site. Record the real first day and the real last day, and assume any gap still counts unless you have been advised otherwise.
I work remotely from another country for a company back home — who taxes me?
Usually the country you are physically in, because employment income is generally sourced where the work is done, with your residence country taxing it as well if you are resident there and giving credit. Three things follow: your employer may acquire withholding and social security obligations where you sit, a treaty tie-breaker may be needed if both countries call you resident, and a short trip that becomes a long stay can cross a residence threshold nobody was watching. See remote workers and digital nomads.
How do you avoid double taxation?
You claim relief once, in the right country, in the right order. Usually the source country taxes first, the residence country then gives a credit for that tax against its own charge on the same income, and a treaty caps the source-country rate. Getting the order wrong is what produces a double charge you then have to unwind. The mechanism differs by income type, which is why we map the whole position before filing either return. See how to avoid double taxation.
