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HMRC internal manual

Capital Gains Manual

Non-resident companies: double taxation agreements: Payment of UK tax by non-resident company

TCGA92/S13 (11)

The non-resident company may pay the UK tax due from a UK resident when gains have been apportioned to him under TCGA92/S13. If so, TCGA92/S13 (11) provides that the payment of the tax on behalf of the UK resident does not give rise to any further liability in the hands of the UK resident. You do not treat the payment as income of the resident or as a capital distribution in respect of the shares in the non-resident company. TCGA92/S13 (11) will also apply if the liability arises because a UK resident has an indirect shareholding in the non-resident company. The liability can be paid by any of the non-resident close companies in the chain.