Income Tax Act 2007 section 835M

The independent investment manager conditions

Section 835M sets out the five conditions that must be satisfied for a UK-based investment manager to avoid being treated as the UK representative of a non-UK resident in relation to an investment transaction carried out on behalf of that non-resident.

• The investment manager must be carrying on a genuine investment management services business at the time of the transaction, and the transaction must be carried out in the ordinary course of that business.
• The relationship between the investment manager and the non-UK resident must, in its legal, financial and commercial characteristics, be one of independent parties dealing at arm's length.
• The requirements of the 20% rule set out in section 835N must be met in relation to the transaction.
• The remuneration the investment manager receives for the transaction must be at least equal to the customary rate for that class of business.