Commentary

A4.454 Payment of royalties without deduction of tax

Administration and compliance

A4.454 Payment of royalties without deduction of tax

A4.454 Payment of royalties without deduction of tax

For the latest New Development, see ND.1438.

A company paying royalties which would normally require income tax to be deducted under ITA 2007, ss 903(7), 906 (see A4.435, A4.441), may make the payment without deduction of income tax if, at the time of the payment, the company considers that conditions (A)–(C) in A4.451 are satisfied1.

If, in fact, the conditions are not satisfied, the provision authorising payment without deduction is treated as having never applied to the payment2.

The company does not need to obtain advance approval from HMRC, but if HMRC are not satisfied

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