Doing business overseas

1. [Approach to doing business overseas](https://library.croneri.co.uk/navigate-taxb/po-heading-id_tHSfvaiAI0KKadGly8BpZA)

1.1. No taxable presence

1.1.1. Advertising

1.1.2. Local (independent) representative or distributor

1.2. Taxable presence

1.2.1. Permanent establishment

1.2.2. Local subsidiary

1.3. Dictated by local regulatory, commercial or practical considerations (and not by tax)?

2. What is a [permanent establishment (PE)?](https://library.croneri.co.uk/navigate-taxb/po-heading-id_tHSfvaiAI0KKadGly8BpZA#po-heading-id_He0U9BVD0k-KXXKWqJexfg)

2.1. Fixed place of business

2.1.1. Ancillary exceptions

2.2. Agent concluding contracts

2.2.1. Exception for independent agents

2.3. BEPS Project leading to changes to PE definition

3. [Taxation of PE](https://library.croneri.co.uk/navigate-taxb/po-heading-id_tHSfvaiAI0KKadGly8BpZA#po-heading-id_He0U9BVD0k-KXXKWqJexfg#)

3.1. UK 'parent' has access to PE's (early years') losses

3.2. Local corporate tax on profits of PE

3.3. UK corporation tax on profits of PE (with credit for overseas tax)

3.4. Possible election for branch tax exemption or conversion to subsidiary (when move into profit)

4. [Other tax issues relevant to PE/local subsidiary](https://library.croneri.co.uk/navigate-taxb/po-heading-id_ZQOf6ibl2UOWwy4Ib-coiA)

4.1. Finance (deductibility of finance costs)

4.2. Transfer pricing

4.3. Controlled foreign companies; Diverted profits tax

4.4. Withholding taxes (interest/royalties)

4.5. Ease/difficulty of conversion of branch to subsidiary

5. [Taxation of local subsidiary](https://library.croneri.co.uk/navigate-taxb/po-heading-id_tHSfvaiAI0KKadGly8BpZA#po-heading-id_EfKO1DqV30Wq3wThsaZBTQ)

5.1. Losses may be 'locked in' and incapable of use by UK parent

5.2. Local corporate tax on profits

5.3. No UK corporation tax on subsidiary's profits (same result as under branch tax exemption for PEs)

5.4. No UK tax on repatriation of subsidiary's profits

5.5. Sale of subsidiary free of UK tax on gains (if SSE in point)