Providing taxpayer ID for Scottish LLP

[Zyncol]

Hello guys, I've got this tricky situation and it would be great to hear some feedback from you.

When applying for a payment processor, they have asked Scottish LLP to provide the company's taxpayer ID. What exactly should be provided in this situation?:

Scottish LLP has a general partner which is a Nevis company.

Scottish LLP is a transparent entity, so no taxes, therefore no taxpayer ID. Nevis is also a transparent entity, therefore the same story. UBO is from a country with a territorial tax system with 0% taxes on foreign income.

Does that mean that it's okay for the UBO to just provide his own personal tax ID? Would that satisfy payment processors?


Also, after investigating this for a while, it looks like this is a 'perfect' structure with zero taxes while it's totally legal. I'm just a bit skeptical because this sounds too good to be true.. Maybe I'm missing something here? What could go wrong in this scenario?

 

[Marzio]

Zyncol said:
company's taxpayer ID
Click to expand...

The payment processor is asking for UTR number.

Zyncol said:
What could go wrong in this scenario?
Click to expand...

So LLP has 2 partners, one is a Nevis LLC and the other is a person with tax residency in a territorial tax system? In that situation, depending on which territorial tax country the person is living, he could create a permanent establishment by performing the work from that country.

 

[Zyncol]

The general partner is Nevis company, the limited partner is another transparent offshore company. The general partner (Nevis) controls the partnership, UBO of the general partner is living in a territorial tax country.

 

[Marzio]

Well at this point i'm pretty sure you are talking about a Scottish LP and not LLP because in a LLP there are no limited partners but this distinction doesn't change the fact that if the UBO is working from a territoial tax country is creating a permanent establishment and should pay taxes there.

Of course there are some countries that simply don't care and will never go after you, other could enforce that.

 

[Zyncol]

You're right, it's indeed LP and not LLP.

You're also right regarding what we need - looks like it's UTR but it doesnt look like tax-transparent Scottish LP can obtain one?

Regarding permanent establishment, it's tricky because business is all digital, the director is from another country and team members are also from different countries.

Anyway, the main question I guess is if UTR can be replaced with UBO's personal tax id?

 

[Marzio]

Zyncol said:
Anyway, the main question I guess is if UTR can be replaced with UBO's personal tax id?
Click to expand...

I don't think so because Scottish LP is a different entity.

It's better for you to get in touch with somebody that will help you get an UTR code for your LP

 

[fshore]

What country is the payment processor from? You can probably also use the llp's registration number.

 

[Zyncol]

Cyprus.

I actualy did find the UTR code in the HMRC documents. Just wondering if that equals taxpayer ID in our situation.