Is there a requirement to deduct tax on the interest payments made to clients?
Where a firm of solicitors holds monies on behalf of clients, is there a requirement to deduct tax on the interest payments made to the clients? Does this position change if the client is non-UK resident?
My understanding is that where interest is credited to the account without tax deducted, the interest is paid to the client gross. Similarly, if tax is deducted the interest is paid to the client net.
Does the firm have to deduct tax on payments to non residents if they have not submitted a form R105?
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