UK non-resident companies

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	Untitled Document UK non-resident companies UK companies whose place of effective management is located in a country which has ratified a double tax treaty with the UK based on the OECD Model will be considered non-UK resident for UK tax purposes (s249 FA 1994). Treaty countries with low rates of corporation tax e.g. Cyprus, Mauritius or Malta therefore offer tax-efficient locations for the management of UK companies. Prior to a UK company migrating its residence from the UK to another territory, the UK company must notify the UK Inland Revenue and obtain the Revenue's approval of migrating the company's arrangements for securing that any UK tax due from financial periods prior to the migration from the UK is paid. For newly incorporated UK companies this should be a straightforward process. For UK resident companies that have traded for a while, and which plan to migrate, the "exit" or migration charge under s185 CA 1985 (whereby the company is deemed to have disposed of its assets for CGT purposes immediately before migration) is a potential difficulty. However, it would now appear to be an illegal charge if the UK company is migrating to another EU country, being a violation of the EC Treaty principle of freedom of establishment within the European Union. Certainly, the European Court of Justice ruled such an exit charge to be illegal in the case of Hughes de Lasteyrie du Saillant v Ministere de L'Economie, des Finances et de L'Industrie. Although this case ruled that an exit charge on natural persons migrating from one EU state to another was illegal, it is difficult to discern a principle by which the ratio of this case does not apply equally to companies having their registered office, or "seat" within the EU, and which intend to migrate to another EU Member State. For further information on these services, please contact any of our specialists whose telephone, email and fax details are on this page. Alternatively, to provide us with preliminary instructions for a proposed UK company, please click here.

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	For further information (including charges), please contact any of the following: Click contact name to email Jason Reader +44 (0)117 918 1387 Rachel Flower +44 (0) 117 918 1326 Martin Palmer +44 (0)117 918 1321 Jordans Limited 21 St Thomas Street, Bristol BS1 6JS Tel: 0117 923 0600 Fax: 0117 923 0063 DX 78161 Bristol Email Location Map

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