tax due on income from a hong kong company

off shore companys

Didn't find your answer?

ii am a uk tax payer but if i am a the controlling shareholder of a hong kong ltd company and that company makes say 100,000 profit in a year (the company makes profits from uk investments)

but the company does not pay me any dividend or wages in that year do i have to pay any tax in the uk in that year from the earnings of that company.

thanks for any help

 

 

 

 

 

 

Replies (9)

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Scalloway Castle
By scalloway
22nd Feb 2017 20:22

You only pay tax on your income. You only get income from a limited company if it pays you a salary or a dividend. You appear to have received neither.

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Replying to scalloway:
By Ruddles
22nd Feb 2017 20:39

Hold on a moment - what about TCGA 1992 s13?

Not nearly enough information in the question to conclude one way or the other - what a surprise.

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Replying to Ruddles:
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By Accountant A
22nd Feb 2017 21:13

Ruddles wrote:

Hold on a moment - what about TCGA 1992 s13?

Good call! I've learnt something today.

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By Accountant A
22nd Feb 2017 20:31

Possibly not but if it is a venture you are seriously considering, you would be well advised to appoint an adviser - or two, as you will need to understand any obligations in HK.

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By jonsam89
22nd Feb 2017 23:34

the company would have 5 or 6 shareholders and be controlled by me and my wife as 51 percent of the shares. so i guess it would be considered a closely controlled company. the revenue would be realised from rents from property.

is there anything else i need to tell you ?

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By Matrix
23rd Feb 2017 08:05

If you are managing the company from the UK then I expect the profits will be brought onshore. Why a HK company? What advice have you already received?

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By jonsam89
23rd Feb 2017 09:11

i have had no advice so far, a hk company because 0 tax on off shore income,easy to set up and i already am importing from hk to the uk

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By Justin Bryant
23rd Feb 2017 09:58

Assuming these are revenue (income) & not capital profits, s720 ITA 2007 may be more relevant (unless motive test applies etc.).

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By Dick Stastey
23rd Feb 2017 11:04

On the assumption that the OP transferred the UK investments (or the means to acquire them) to the Hong Kong company, then I agree that ALL of the income of the Hong Kong company is taxable on the OP, under the ToAA legislation, unless the Hong Kong company is UK resident (and, therefore, liable to UK corporation tax), by reason of being managed and controlled from the UK.

I also agree that 51% of any gains that the the Hong Kong company may make are taxable on the OP, unless it is UK resident.

Both matters need to be correctly self-assessed.

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