UK sales manager of Cyprus company

reader said:

AlexCh said:

reader said:

AlexCh said:

reader said:

No, you are wrong.

Your Cyprus company needs to sign a contract with his limited company (not him).

If you sign a contract with him (not his company) you need to setup a UK branch and PAYE. The bank account you pay into is irrelevant. The contract is more important.

reader said:

No, you are wrong.

Your Cyprus company needs to sign a contract with his limited company (not him).

If you sign a contract with him (not his company) you need to setup a UK branch and PAYE. The bank account you pay into is irrelevant. The contract is more important.

Thank you very much for the clarification.
We thought it was somehow possible to have him on our Cyprus company payroll without establishing any UK legal entities.

For a UK resident UK tax would be due.

There you would need a UK branch operating PAYE or he would need a UK company operating the IR35 rules: https://www.gov.uk/hmrc-internal-manuals/paye-manual/paye81605

Thank you for your reply.
Could you kindly clarify one point.
We rent our sales office in London (our Cyprus company pays for it) and the salesperson (UK LTD company) operates from the office. Does it mean that we have our Permanent establishment and tax residence in the UK in accordance with this
https://www.gov.uk/hmrc-internal-manuals/international-manual/intm264300
and we must register with HMRC
or we are exempt because of this
-CTA2010/S1143 goes on to say that there is no permanent establishment in the UK if the activities here, whether conducted through a fixed place of business or by an agent, are preparatory or auxiliary in character in relation to the business as a whole. The statutory definition includes the activities that are listed as “activities of a preparatory or auxiliary character”

Our lead generation/sales activity is not our main activity, we are not a trading company, we find customers and provide them our services.
Thank you

It is not possible to comment on whether or not you have a permanent establishment in the UK without knowing:
1) What services are you selling?
2) Where the fee earners are based?
3) Are contracts entered into in the UK by the sales manager?
4) Will the office you are renting be just for the sales manager? Or will you be subletting too?

A UK sales agent acting on behalf of a non-UK resident company who continually exercises authority to do business on the company's behalf may create a UK permanent establishment. If contracts are made outside the UK, the company may not be trading in the UK, but this will not be conclusive if there are other factors that are more important.

MarieNoelle said:

CSan89 said:

You do realise that this forum isn't a free accountancy advice forum but for AAT students/members to discus accountancy matters?

It sounds like your business model is quite complex and I would strongly suggest to hire a UK accountant so they can look into your affairs in more depth because more and more things keep coming out of the woodwork with every post you make.

Just to reiterate what @CSan89 has politely pointed out to you - this is an extract of our Community rules.

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We have very kindly provided some answers but the advice remains the same - engage a UK accountant. It will be money well spent.