Last updated: 14 October 2026
Is charging fees through your Spanish company taxable in the UK?
If you’re UK resident, routing your fees through a Spanish company doesn’t automatically take them out of UK tax. If the company is managed and controlled from the UK, because you make its decisions here, it’s UK resident and pays UK corporation tax on its profits. If it’s genuinely Spanish resident, it pays Spanish tax, but what you take out as salary or dividends is taxable on you in the UK, with credit for Spanish tax under the UK-Spain double tax treaty. Personal services you perform in the UK may also be taxed here as your employment or trading income.
Where the tax falls
| Situation | Company taxed in | Your extraction taxed in |
| Company run day-to-day from Spain by Spanish-based directors | Spain | UK (as UK resident), with treaty credit |
| You, a UK resident, make all key decisions from the UK | UK (central management and control) | UK |
| Company has a UK permanent establishment | Both, with treaty relief | UK |
| You become non-UK resident and live in Spain | Spain | Spain, subject to UK source rules |
Central management and control
A company incorporated abroad is UK resident if its central management and control is exercised in the UK. Holding board meetings in Spain on paper isn’t enough if real decisions are made by you at home in the UK. HMRC looks at where strategic decisions are actually taken.
Example
Laura, who lives in Bristol, set up a Spanish SL while living in Valencia. She returns to the UK in 2025 but keeps invoicing UK clients through the SL, which she runs from her laptop at home. The SL is now UK resident through central management and control, so it should register for UK corporation tax. Her dividends are taxable in the UK at 10.75% and 35.75% in 2026/27. The SL may still have Spanish filing obligations.
Anti-avoidance rules
- Transfer of assets abroad: income of an overseas entity can be taxed on a UK resident who arranged the transfer
- Controlled foreign companies: apply to UK companies with overseas subsidiaries
- IR35: may apply if you work for UK clients through an intermediary
- Diverted profits and permanent establishment rules
Reporting
You must declare your Spanish company income, including dividends and salary, on your UK Self Assessment return using the foreign pages. Claim foreign tax credit relief for Spanish tax paid. Since 6 April 2025, the remittance basis has been replaced by the 4-year foreign income and gains regime, so most long-term UK residents are taxed on foreign dividends as they arise, whether or not the money is brought to the UK.
Common mistakes
- Assuming an overseas company protects income from UK tax
- Running the company from the UK without registering it
- Not claiming treaty credit, leading to double tax
- Ignoring Spanish obligations after returning to the UK
Records to keep
Keep board minutes showing where decisions were made, company accounts, Spanish tax returns and evidence of dividends paid.
Frequently asked questions
Can I keep my Spanish company if I move back?
Yes, but its residence may change.
Is Spanish withholding tax creditable?
Yes, under the treaty.
Should I close it?
Often simpler, but take advice in both countries.
Does the 4-year FIG regime help?
Only if you’re a new UK arrival after 10 years non-resident.
Related: whether to incorporate, HMRC enquiries about money overseas and the best business structure.
Talk to Accotax
Want this handled for you? Our team at Accotax can help with international tax. See our small business accountants service, or contact us for a free, no-obligation quote.
This page is general guidance based on HMRC rules for the 2026/27 tax year, checked against gov.uk on 14 October 2026. It is not personal advice, so speak to an accountant about your own situation.
