The general rule is that a UK resident company is liable to corporation tax on its worldwide income including that earned through a foreign PE (see ¶19000). This is the case whether or not the income is remitted to the UK although relief is available where the company is unable to remit the overseas income.

Trading income and expenses relating to the PE are included within total trading income. However, where the trade is carried on ‘wholly outside the UK’, a trading loss relating to the PE can only be offset against future profits from that PE (see ¶32210).

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