I was wondering whether you have come across a similar issue before?
A client, who is the sole director of a company, providing consultancy services, is moving to Europe. The country he is relocating to has a Double Taxation Agreement with the UK, so we are not too concerned about double tax on dividends, etc...
He wants to continue running his consultancy company from abroad, working online.
He has to trade through a UK Ltd Company for commercial and legal reasons.
The question is...
His Permanent Establishment will most likely be the new EU Country, because he is based there - hence the company is controlled from there (he has no employees). Travel to the UK will be limited - to meet new clients or resolve any major issues.
How can he go around this and keep his UK Ltd company, yet paying tax in the right place? Will he need to register a company in the new country and do management recharges, based on a transfer pricing method?
As mentioned, he has to trade through a UK Ltd Company for commercial and legal reasons.