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HMRC internal manual

Double Taxation Relief Manual

Non-residents: UK income: Trading through a branch or agency

If a non-resident company trades in the United Kingdom through a branch or agency ICTA88/S11 (2)(a) says that its chargeable profits shall include `any trading income arising directly or indirectly through or from the branch or agency’. These words appear to be rather wider than the Income Tax `profits or gains arising from any trade exercised within the United Kingdom’. But the condition precedent in ICTA88/S11 (1) - that the company carries on a trade in the United Kingdom - imports the Income Tax principles of `trading in’. Once that hurdle is crossed it is possible that the Corporation Tax charge on trading profits extends beyond the Income Tax charge. But that would be in the rather exceptional circumstances of overseas activities being connected with the United Kingdom branch.