A server physically located in the UK cannot give a person a permanent establishment in the UK. Christopher Eames (Mishcon de Reya) considers a real life scenario which tests the limits of that principle.
Question
My client runs a successful crypto-trading business and would like to cease UK tax residence in order to avoid UK income tax on the profits of the trade. He uses a virtual server in London to ensure he is physically proximate to the crypto exchange. Could this virtual server give him a taxable presence in the UK?
Answer
The UK takes a relatively categoric stance that a server physically located in the UK cannot give a person a permanent establishment in the UK. However the limits of this principle have not been tested and as ever the devil is in the detail.
Background to co-location services
Crypto assets are extremely volatile. The price of a particular asset can...
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A server physically located in the UK cannot give a person a permanent establishment in the UK. Christopher Eames (Mishcon de Reya) considers a real life scenario which tests the limits of that principle.
Question
My client runs a successful crypto-trading business and would like to cease UK tax residence in order to avoid UK income tax on the profits of the trade. He uses a virtual server in London to ensure he is physically proximate to the crypto exchange. Could this virtual server give him a taxable presence in the UK?
Answer
The UK takes a relatively categoric stance that a server physically located in the UK cannot give a person a permanent establishment in the UK. However the limits of this principle have not been tested and as ever the devil is in the detail.
Background to co-location services
Crypto assets are extremely volatile. The price of a particular asset can...
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes:
