Registering a non-resident company for corporation tax in UK
Where non-resident companies who are not registered with UK Companies House but operate in or own UK property used to file an SA700 under the self-assessment income tax system are now liable to pay corporation tax under the same system as UK based businesses via a traditional CT600 corporation tax return.
The corporation tax system, in place since 2020, has more complexities than the old income tax system. In this article, we’ll cover everything you need to know to register your company to pay UK Corporation Tax, exploring what documents and supporting information you will need to have available to do so.
Who should register?
You will be liable to pay Corporation Tax if you are a non-resident company or collective investment vehicle that is formally recognised as a company and is disposing of UK land or an asset (such as shares) in the UK.
You will also hold Corporation Tax liability as a non-resident company if you generate property income via UK rental income. However, simply holding the asset of UK residential property itself does not mean you are liable for corporation tax.
Non-resident companies who have previously registered for Corporation Tax but have since been ‘dormant’ for tax purposes must also re-register.
Registration can be done yourself or you can have an agent act on your behalf, such as Sleek. This is recommended for those unfamiliar with UK Corporation Tax regulations.
There are also exemptions for certain circumstances such as if no gain or loss arises from the disposal. For a full list of exemptions see the HMRC site.
Note that construction companies with an overseas registered office and no permanent UK establishment are not subject to the same regulations as a property business and will need to register separately through the dedicated construction industry scheme.
How to register a non-resident company for corporation tax?
Registration must be made using HMRC’s online services. The exact steps will depend on whether you already have a Government Gateway user ID and have previously registered with them for corporation tax purposes.
If you have already registered you can request HMRC to send you a corporation tax Unique Taxpayer Reference (UTR) code via the online portal.
For those who do not already have a Government Gateway user ID HMRC will not have records set up for the company. You will need to register online on the government website and allow time for them to process the registration and send out your access codes.
Codes can take between 2-8 weeks to arrive at your overseas registered office address so it’s best for a non-resident company to register as soon as possible to avoid any penalties for the late filing of a corporation tax return.
What documents will you need?
Whether your registering for the first time or re-registering due to dormancy, you will require the following information and documentation:
- The company name, the registered overseas address and all contact details
- Any prior names of the company
- The date your company was incorporated
- The name of the company directors, their addresses and contact information
- What date the interests in UK property or land were disposed of
- Your income tax self-assessment unique taxpayer reference (UTR) if you’ve either registered with HMRC previously or received rental income on UK property not subject to income tax deducted at source
When to register?
You have to register within 3 months of becoming liable to pay UK Corporation Tax.
This will generally be 3 months from the disposal date of the property-rich company or property.
It’s best to not leave this until the last minute as initial registration can take up to 8 weeks.
Once you’ve registered, HMRC will send access codes for their online services via post as well as setting up a record for the company itself.
They will also send a corporation tax UTR and further information with information on how to submit your corporate tax return and make payments.
How Sleek can help
Having provided years of support to people filing for corporation tax from other countries, Sleek can act on your behalf to ensure that the entire process runs smoothly. Also, if you’re seeking someone to manage your accounts or are in need of a registered office in the UK, please get in touch.
UK Corporation Tax can be a minefield for those unfamiliar with the systems. Register as soon as possible and ensure you fully understand all supporting information to avoid getting caught up in back-and-forth with HMRC.
Yes, companies who were originally incorporated in the UK or held a UK based registered office but now operate overseas may be treated as a non-resident company for Corporation Tax purposes through double-taxation treaties.
For this to apply, the territory the company is primarily operating out of must be somewhere where the double taxation treaty is eligible and the company must be effectively managed from the treaty state. Find information about double taxation treaties here.
Generally, a non-resident company is any company that was not incorporated in the UK and is controlled and centrally managed overseas.