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HMRC internal manual

International Manual

HM Revenue & Customs
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Non-residents trading in the UK: through UK investment managers, brokers or Lloyd’s agents: introduction

The assessment and collection of non-residents’ tax liabilities

The machinery provisions at ITA07/S817 to S828 and S835C to S835S for income tax and at CTA10/S969 to S972 for corporation tax provide a practical means of taxing the non-resident by imposing the liabilities and obligations under the Taxes Acts on the non-resident’s UK representative. Their effect and the obligations imposed upon the respective UK representatives of non-resident individuals and non-resident companies are broadly equivalent.

The general guidance on the machinery provisions can be found at:

* Who can be the non-resident’s UK representative? INTM268020
* Extent of the UK representative’s liability? INTM268030
* What assessments should be raised and how is that done? INTM268040
* What other obligations does the UK representative have? INTM268050

Investment manager exemption provisions

This guidance concerns the exemption from being treated for tax purposes as the ‘UK representative’ of a non-resident trading in the UK. Clearly the exemption would only be in point if the non-resident is trading in the UK as determined by reference to the transactions carried out for the non-resident by the UK investment manager.

Whether or not a non-resident is trading is a question of fact to be determined by reference to all the facts and circumstances of the particular case including the nature of the wider business activities of the non-resident.

The Business Income Manual contains guidance on the tax concept of “trade” at BIM20000 onwards. BIM20252 includes guidance on the tax treatment of financial transactions.