INTM180010 - Foreign entity classification for UK tax purposes: Introduction

What is foreign entity classification?

Foreign entities and undertakings can be classified for UK tax purposes as:

(a)听听听 A partnership, company or trust, or as

(b)听听听 바카라 사이트淭ransparent바카라 사이트� or 바카라 사이트渙paque바카라 사이트�.

This guidance is only concerned with whether an entity should be classified as 바카라 사이트渢ransparent바카라 사이트� or 바카라 사이트渙paque바카라 사이트�. Guidance on whether an entity or undertaking is a partnership, company or trust can be found at PM288000, CTM00510 and TSEM1002 respectively.

Meaning of 바카라 사이트渢ransparent바카라 사이트� or 바카라 사이트渙paque바카라 사이트�

When we describe a foreign entity as 바카라 사이트渢ransparent바카라 사이트� in INTM180000+, we mean that its members will generally be liable to UK tax on the profits, income or gains of the entity rather than only on any distributions from the entity. When an entity is described as 바카라 사이트渙paque바카라 사이트�, its members will generally be taxed only on the distributions made by the entity.

However, it is important to remember that 바카라 사이트渢ransparent바카라 사이트� and 바카라 사이트渙paque바카라 사이트� are not terms which are usually used in the legislation (an example of an exception would be CTA09/S438). Rather, they are informal labels which we use in this guidance to describe who is liable to UK tax on what profits, income or gains. As such, it will always be necessary to consider the particular UK taxation provision under which the matter must be considered.

For example, if you need to consider whether a UK resident individual member of a foreign entity is liable to UK tax on the trade profits, you will need to consider whether the member can be regarded as 바카라 사이트渞eceiving or entitled to the profits바카라 사이트� for the purposes of ITTOIA05/S8. If they can, the entity could be described as 바카라 사이트渢ransparent바카라 사이트� in the sense that the member is liable to UK tax on the profits.

If the entity is a company (within the meaning of CTM00510) which is resident in the UK (INTM120000) or carrying on a trade in the UK through a permanent establishment (INTM260000), you may also need to consider whether the profits are 바카라 사이트渙f바카라 사이트� the company for the purpose of CTA09/S2. If so, the entity could be described as 바카라 사이트渙paque바카라 사이트� in the sense that the company is liable to UK tax on the profits.

Purpose of guidance

The purpose of the following guidance is to explain:

  • The criteria we use to reach a general view on whether a foreign entity will be 바카라 사이트渢ransparent바카라 사이트� or 바카라 사이트渙paque바카라 사이트� 바카라 사이트� INTM180020
  • What our general view of different types of entities is 바카라 사이트� INTM180030
  • The circumstances in which our view of a specific entity may vary and how we reach a definitive view 바카라 사이트� INTM180040
  • Our view of Delaware LLCs in light of Anson 바카라 사이트� INTM180050
  • Who to contact for further information 바카라 사이트� INTM180060