Overseas Director with UK Ltd Company

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I do the personal tax return for an individual with UK property who lives overseas.  I report his UK property income as a non resident landlord but it has recently come to light that he's the sole Director/Shareholder of a UK Ltd Company from August 2022. I've been assured there has been no renumeration to the Director but apparently the business is just taking and I've been asked to do the accounts etc.  Other than the Director being subject to PAYE or dividend tax on renumeration, even if here on business for just one day is there anything else I need to be aware of?  I will of course run a new AML check on the individual. I have no qualms on the business itself as it's internet based providing training so can be operated from anywhere and the individual was born in this country with family here.

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By Tax Dragon
13th Feb 2024 11:31

legerman wrote:

is there anything else I need to be aware of?

I wouldn't advise on non-UK issues, but you need to be aware there are some. Including where the company is tax resident, which may well be outside the UK.

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By Duggimon
13th Feb 2024 11:55

The company will likely be tax resident in the UK, and also possibly tax resident elsewhere. There are UK tax issues for any/all income the director receives from the company, not just remuneration. The director would be well advised to seek tax advice from someone in their local jurisdiction.

I have had two clients in this exact position and the eventual tax treatment, after discussion between myself, the client, the local tax agents and the tax authorities in both jurisdictions has been different in each case, there's a lot of nuance and complications that can arise.

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Replying to Duggimon:
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By legerman
14th Feb 2024 21:43

Duggimon wrote:

The company will likely be tax resident in the UK, and also possibly tax resident elsewhere. There are UK tax issues for any/all income the director receives from the company, not just remuneration. The director would be well advised to seek tax advice from someone in their local jurisdiction.

Just so I understand, why might the Company have tax consequences in a different jurisdiction? It has a UK address (serviced office)

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Replying to legerman:
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By Leywood
14th Feb 2024 23:54

This is covered off a lot on here.

Perhaps this is one you pass on to someone else?

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Caroline
By accountantccole
13th Feb 2024 12:27

The taxation of any salary will surely depend where he is performing the duties? If he is based overseas you would need to check the rules for that country
If he travels to the UK to work, then UK payroll may be appropriate.

Big issue for me is controlling the company from overseas and what corporate taxes are likely to be due in that country. He needs to speak to a specialist in that country as well as considering UK issues.
If it is France - message me!

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By legerman
14th Feb 2024 21:03

Thanks all. Good advice regarding tax residence, i will check that out.

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