Call Us Today! 01483 456363  xero-transparentrb1
This email address is being protected from spambots. You need JavaScript enabled to view it.

Non-resident company taxation

Source: HM Revenue & Customs | | 21/07/2022

Non-resident companies with a trading business in the UK are liable to pay UK Corporation Tax on their profits made through a permanent establishment/branch or agency.

If the non-resident company is deemed liable to pay Corporation Tax, then its chargeable profits are:

  • any trading income arising directly or indirectly through or from the permanent establishment/branch or agency,
  • any income from property or rights used by, or held by or for, the permanent establishment/branch or agency except dividends or other distributions received from companies resident in the UK, and
  • chargeable gains falling within TCGA92/S10B.

There are however some differences in the taxation of non-resident companies as opposed to resident companies. For example, a non-resident company:

  • is not liable to account for ACT on distributions made before to 6 April 1999,
  • cannot have 'franked investment income',
  • cannot have surplus franked investment income for the purposes of ICTA88/S242,
  • cannot set trading losses against dividend income to augment its trading income for the purposes of absorbing losses brought forward.

Any UK-source income received by a non-resident company which does not carry on a trade in the UK through a permanent establishment/branch or agency is subject to UK Income Tax. Any Income Tax due is calculated at the basic rate only without any allowances, subject to any applicable Double Taxation Agreement.



Contact Us

1 High Street
Guildford
Surrey
GU2 4HP
01483 456363

Tel: 01483 456363
This email address is being protected from spambots. You need JavaScript enabled to view it.

 

 

Newsletter

With our newsletter, you automatically receive our latest news by e-mail and get access to the archive including advanced search options!

» Sign up for the Newsletter
» Login

 

Membership

ICAEW-White

Search News