Who pays corporation tax?
Corporation tax is payable by UK resident companies, and by non-resident companies carrying on a trade in the UK through a permanent establishment. In addition, unincorporated bodies that are not partnerships (e.g. members’ clubs, societies and voluntary associations) fall within the scope of corporation tax. (ICTA 1988, ss 6, 11-11AA) • What makes a company UK resident? A company is normally considered to be resident in the UK if it is incorporated in the UK. A company that is incorporated abroad is treated as UK resident if it is managed and controlled from the UK. However, a company which is regarded as non-UK resident under the terms of a double tax treaty with another country is treated as being non-UK resident for tax purposes. (FA 1988, s 66, Sch 7; FA 1994, ss 249-250) • What is corporation tax charged on? Corporation tax is charged on the worldwide profits of a UK resident company. Non-resident companies with a permanent establishment in the UK from which it carries on a trade
