Rent paid to offshore company

Rent paid to offshore company

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We have a client who's landlord is now offshore and the company is based in Gibraltar. They've been told that they have to deduct tax from their rent payment before they transfer it to them and pay it over to HMRC. Is this correct and at what rate would be payable? 

How would they go about reporting it?

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By UK Tax
27th Jan 2012 08:20

NRL- non-resident landlords

Your client deducts basic rate unless the landlord gets permission to receive rent gross.  It's set out here:

http://www.hmrc.gov.uk/international/nr-landlords.htm

 

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By 0098087
27th Jan 2012 08:24

And how would this be reported? 

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Replying to Peter613:
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By UK Tax
27th Jan 2012 08:32

Quarterly

If you click on the link and go to tenants obligations etc it is all there.

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By 0098087
27th Jan 2012 08:32

I assume that the tax they pay over would then be deductible against corporation tax?

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By UK Tax
27th Jan 2012 08:39

Yes, as part of rent

In my view it's all just rent in your client's P&L - the e.g. £80 paid to the landlord and the £20 withheld and paid to HMRC. 

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