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Readers' forum : Living in the UK

27 September 2016
Issue: 4569 / Categories: Forum & Feedback

How is income from a US S-Corp taxable in the UK?

We have a new client who is a US citizen and who moved permanently to the UK in June 2015. I am satisfied that he will be regarded as UK resident from June 2015 and that split-year treatment will apply from that date. He is a member of a US S-Corp (a special type of corporation created through an IRS tax election) which is managed within the US and does not operate in the UK.

Our client is the largest single shareholder with 40% of the shares. The S-Corp is not taxable in its own right but the client is taxable in the US on his share of the profits and any salary paid to him by the S-Corp. As such it seems similar to our partnerships.

How is his income from the S-Corp taxable in the UK? Is it regarded as self-employment in which case...

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