Income Tax Act 2007 section 835Y

Meaning of "independent agent"

Section 835Y defines the term "independent agent" as it applies to a non-UK resident's representative in the United Kingdom, and sets out the conditions that must be met for a person to qualify as acting in an independent capacity.

• An independent agent is a person who acts as the UK representative of a non-UK resident ("X") in an agency capacity, provided they do so independently.
• The relationship between the agent and the non-UK resident must be assessed by reference to its legal, financial and commercial characteristics.
• The agent is only considered independent if the relationship resembles that of two separate businesses dealing with each other at arm's length.
• If the relationship does not meet the arm's length standard, the person cannot be classified as an independent agent under this provision.