I have a client, who is a sportsman, who has received prize money in both Germany and China. In both cases withholding tax has been deducted. Can this be deducted from tax due in the UK on his total income or do we have to apply to Germany and China for refunds?
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UK/Germany DTT
Bit late on this one - just looking at the UK/Germany treaty, Article 16 refers to sportsmen and Article 23 the elimination of double taxation. The prize money is taxable in Germany but a credit may be taken in the UK for the tax withheld. I would expect the same to be true for the treaty with China.
Yes and no
Can this be deducted from tax due in the UK on his total income
You need to calculate the UK tax on that part of the income (less attributable expenses) that was subject to withholding. Under the double taxation treaties with most countries, a credit against that part of the UK tax liability may be taken for the amount of foreign tax withheld (limited to the amount of UK tax attributable to profits from that source).
If the foreign tax exceeds the attributable UK tax, then that excess may be lost. In that situation, an alternative (though less beneficial) method is to claim the foreign tax as an expense (instead of a tax credit), reducing the profits chargeable to UK tax.
I've never dealt with China, so you should check the treaty with that country first. It's available online.