Thomas Dick answers a query on the taxation of a distribution from a Washington-based limited liability company.
Question
My client has a 50% interest in a Washington LLC (which I have assumed behaves like a Delaware LLC). The LLC receives rental income from commercial properties of around $200 000 pa with total profits of $100 000. There is an unrealised capital gain of $500 000. Tax returns have been filed in the US. Following Anson [2013] EWCA Civ 63 I am assuming that there will be no UK tax until a distribution is made and that there will be no UK tax on dividends within the basic rate of tax. If the dividend exceeds the basic rate tax presumably there will be no credit for the US tax paid? If so would it be worth restructuring as an LP? Would deferral relief apply?
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Thomas Dick answers a query on the taxation of a distribution from a Washington-based limited liability company.
Question
My client has a 50% interest in a Washington LLC (which I have assumed behaves like a Delaware LLC). The LLC receives rental income from commercial properties of around $200 000 pa with total profits of $100 000. There is an unrealised capital gain of $500 000. Tax returns have been filed in the US. Following Anson [2013] EWCA Civ 63 I am assuming that there will be no UK tax until a distribution is made and that there will be no UK tax on dividends within the basic rate of tax. If the dividend exceeds the basic rate tax presumably there will be no credit for the US tax paid? If so would it be worth restructuring as an LP? Would deferral relief apply?
...
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If you do not subscribe but are a registered user, please enter your details in the following boxes:
