Foreign Entity UK Corporation Tax Query

Dear HMRC A foreign limited company, incorporated in Hong Kong, has two directors. Director A is a permanent UK resident and citizen Director B is a permanent Chinese resident and citizen Director A is 100% shareholder of the HK company. Directors A & B have a long-term personal relationship and both actively participate in the business on a daily basis. Please note this is not a "nominee director" situation, but rather a genuine business relationship between two people. Director A is responsible for the company website and marketing activities. They also attend to company matters in the UK and some logistics for UK customer orders. Director B on the other hand is responsible for sourcing products, concluding agreements with manufacturers and fulfilling customer orders globally. Director A has been diagnosed with a dread illness, and at times cannot work at all during periods of poor heath. Sometimes, Director B has to assume all of Director A's responsibilities also. This explanation is to demonstrate a genuine partnership between both directors. Director B earns commissions outside of the limited company for sourcing of products, logistics, etc and has therefore not bothered to ask for shareholding in the limited company as yet. This is of course beyond the scope of my query to HMRC. Clearly, effective management and total responsibility for effective management take place abroad, whilst some duties are carried out in the UK. It should also be pointed out the business has a global customer base, mainly in the United States, Australia, EU & UK. Considering the detailed explanation above, kindly consider if this business has a corporation tax liability in the UK. A detailed explanation would be greatly appreciated.

Hello HMRC. Would anyone be able to respond to my query ?

Hi
Unfortunately we cannot provide a full reply to your question as Corporation Tax is, Self Assessment.
I would suggest you consider the information on our web page Register as an overseas company or seek professional advice.

Hello Thanks for your reply. I’d like to state for the record that I have a professional, qualified opinion. The opinion is the HK company should not register for Corporation Tax in the UK. I do believe that HMRC has a responsibility to answer this query and either confirm or reject this opinion.