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HMRC internal manual

International Manual

Non-residents trading in the UK: through UK investment managers, brokers or Lloyd’s agents: investment manager exemption: effect on potential liabilities of UK representative

Intention of the exemption

The broad effect of the exemption, along with the other provisions of the Taxes Acts, is to ensure that non-residents are not exposed to any additional liability to tax by using the services of independent investment managers in the UK. This is done by restricting the tax chargeable on the income of non-residents in respect of investment transactions carried out through independent UK investment managers to the tax, if any, deducted at source. There is further guidance on the restriction of tax to that deducted at source at INTM269180.

See HMRC Statement of Practice SP1/01, the text of which is reproduced at INTM269200, for guidance on what type of investment management activity falls within the exemption, especially paragraphs 17-22.