Ok this is an update to those with the same situation as me(NON RESIDENT), who want to incorporate/register for a UK limited company or something similar and only want to pay for the UK corporation tax from the income that is ONLY derived from your limited company in the UK. Take note,i know that most of my income is going to come out of the UK. Also you will still be liable to pay income tax in your resident country as that's where your permanent establishment is or going to be considered as your place of residence.(In other words... where you control/manage the biz, hold meetings, do all trades/business, have a office or branch etc)
Ok all information is from
https://www.gov.uk/tax-foreign-income/residence
It's stated there that:
Your UK residence status affects whether you need to pay tax in the UK on your foreign income.
Non-residents only pay tax on their UK income- they dont pay UK tax on their foreign income.
Residents normally pay UK tax on all their income, whether its from the UK or abroad. But there are special rules for UK residents whose permanent home (domicile) is abroad.
Another good reference is from the HMRC:
More...
it's stated there that:
The charge to Corporation Tax
CTA09/S5(2), S19(1) charges Corporation Tax on
non-resident companies trading in the UK through a permanent establishment (previously branch or agency).
Where a company trades in the UK, other than through a permanent establishment (see INTM264050), there can be no charge to Corporation Tax. In those unusual circumstances the charge to income tax under ITTOIA05/S6(2) continues to apply. An example that would fit this situation might be a non-resident company with a peripatetic door to door sales operation where the activities were briefly carried out at a succession of customers premises, or a one-off sale.
Ok that being said, now the first thing you need to do is find out your
residence status. You can do this be going to the link i provided above or by clicking on :
https://www.gov.uk/government/upload...ted_078500.pdf , by following the diagram and instructions given there,you should be able to find out your residence status.
By now you should have known if you are a UK RESIDENT OR NON RESIDENT.
Also try to find out if your country has any double tax treaty with the UK. What this would mean is, you will have to pay for your income tax in your own country of residence and the UK can't make you pay for your worldwide income using the UK limited company because the treaty countries have made a deal with each other to share on the RESIDENT'S OR NON-RESIDENT'S income and since you are doing all work, trade, meetings, transactions etc outside of the UK , you won't have to.
Hope this info will help someone out there. Took me about a week to figure this out by calling Tax accountants in the UK, hmrc etc (where even they did not know or have any idea and said they will get a specialist to call me back :doh
🙂.
P.s: Please take note that i might be wrong with the above mentioned details as i'm not a tax accountant . All this is just based on what i have read or understood so far. If i'm wrong , please do let me know as well.
Thanks
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