Hi,
A UK company with an overseas office is liable to UK corporation tax on its worldwide profits, this includes profits from its overseas operations.
However, there are specific rules and provisions to consider, which include, among others:
Residence Test:
A company is considered UK-resident and thus liable for UK corporation tax if it is incorporated in the UK or if its central management and control are exercised in the UK.
Double Taxation Relief
To avoid being taxed twice on the same income, the UK has double taxation agreements (DTAs) with many countries. These agreements generally allow UK companies to claim relief for foreign taxes paid on overseas profits.
Permanent Establishment: The concept of a “permanent establishment” (PE) is crucial in determining where a company’s profits are taxed.
If the overseas office constitutes a PE under the DTA between the UK and the host country, then the profits attributable to that PE may be taxed in the host country.
Thank you.