Running a UK limited company while living abroad

Key points

Everything turns on your residence in the tax year you take money out of the company.

✓ As a non-resident, only salary for work you do in the UK is taxable here, including UK board meetings.

✓ Dividends are disregarded income for non-residents, so the effective UK liability is normally nil.

✓ Selling the company while non-resident is generally outside UK capital gains tax, unless its value comes mainly from UK property.

✓ Return within about five years and dividends and gains from your time abroad can be taxed when you come back.

✓ A company managed from abroad may become tax resident in that country too.

Can you keep running your UK limited company after you move abroad? Yes. Nothing stops a non-UK resident from being a director or shareholder of a UK company, and plenty of consultants and business owners do exactly that.

This guide focuses on your personal tax as the owner: income tax on a salary, income tax on dividends, and capital gains tax when you sell or close the company. The answer to each depends mainly on one thing.

The key question is simple. Are you UK resident or non-resident in the tax year you take the money out?

If you are not sure, start with our 📖 Statutory Residence Test 101, because everything below turns on it.

Image 1: how what you take out is taxed

Split-year treatment and the five-year return rule can change the answer.

A note on company residence

Under UK law, a company incorporated in the UK is always UK resident. But if you run it from overseas, and all the key decisions are made there, the country you live in may also treat the company as resident where it is managed. The company can then be resident in two places at once.

That is a company-level question rather than a personal one, and it is worth 📖 getting advice on if you will be the only director making decisions from abroad.

👉 HMRC manual: central management and control (INTM120060)

Taking a salary: income tax

How is a director's salary taxed once you have moved? It depends on your residence and on where you actually do the work.

➜ UK resident: your whole salary is taxable in the UK, wherever you do the work.

➜ Non-resident: the UK only taxes the salary for duties you perform in the UK. Days you work in the UK, including attending board meetings here, stay taxable. Salary for work done abroad is outside UK income tax.

➜ The year you leave: if split-year treatment applies, salary for work in the overseas part of the year is treated as a non-resident's.

Where you work partly in the UK and partly abroad, the salary is normally apportioned by workdays. Keep a diary of where you worked each day.

👉 HMRC manual: section 27 ITEPA 2003, UK duties of non-resident employees (EIM40110)

👉 The law: Income Tax (Earnings and Pensions) Act 2003, section 27 (UK duties of non-residents)

Your company will usually keep running PAYE on your salary until HMRC agrees an NT code or a reduced code. Any excess tax is reclaimed through a Self Assessment return. See our 📖 P85 form guide and 📖 working remotely abroad for a UK company.

UK and EEA nationals keep the UK personal allowance while non-resident, so a small UK-taxable salary may be covered by the allowance.

Taking dividends: income tax

How are dividends from your own company taxed? Again, residence is what decides it.

➜ UK resident: dividends above the £500 dividend allowance are taxed at 10.75%, 35.75% or 39.35% in 2026/27, depending on your income.

➜ Non-resident: UK dividends are "disregarded income". No tax is deducted at source, so the effective UK tax is usually nil.

Image 2: the same dividend, resident and non-resident

Coming back within five years? Dividends paid out of profits built up before you left can be taxed in the year you return.

HMRC works out a non-resident's tax both with and without the disregarded income rules, and charges the lower amount. If you have other UK income, such as a UK salary or rent, check both calculations. See our guide to 📖 disregarded income.

👉 HMRC guidance: Tax on your UK income if you live abroad

👉 The law: Income Tax Act 2007, section 811 (limit on liability of non-residents)

Two timing traps

➜ The year you leave: dividends paid in the UK-resident part of the year are taxed as normal. When you declare them relative to your departure date matters. See 📖 split-year treatment.

➜ Coming back within five years: most owner-managed companies are "close companies". Dividends paid while you are away, out of profits built up before you left, can be taxed in the year you return. See the 📖 temporary non-residence rules.

Selling or closing the company: capital gains tax

A sale of your shares, or a capital distribution when the company is closed through a members' voluntary liquidation, is a disposal for capital gains tax.

If you are UK resident when you dispose of the shares

➜ Capital gains tax applies at 18% or 24%, depending on your income, after the £3,000 annual exempt amount.

➜ Business Asset Disposal Relief can reduce the rate to 18% from 6 April 2026, on up to £1 million of lifetime gains. You generally need to have held at least 5% of the shares and been an officer or employee of a trading company for two years. Being a director who lives abroad does not stop you qualifying.

➜ Closing the company through a members' voluntary liquidation usually means the final distribution is taxed as a capital gain rather than a dividend, subject to anti-avoidance rules if you start a similar business soon after.

👉 HMRC guidance: Business Asset Disposal Relief

👉 The law: Taxation of Chargeable Gains Act 1992, section 169H (Business Asset Disposal Relief)

If you are non-resident when you dispose of the shares

Most non-residents are not liable to UK capital gains tax on shares, including shares in their own UK company. There are two main exceptions:

➜ Property-rich companies: if 75% or more of the company's value comes from UK land and property, the gain is taxable in the UK even for a non-resident. See 📖 non-resident capital gains tax.

➜ The five-year rule: if you sell or liquidate shares you already held when you left, and you return to the UK within about five years, the gain can be taxed in the year you come back.

For an exit, the timing of your move, the sale and any return to the UK all need to be planned together. Our capital gains tax advice service covers this.

Checklist before you move

1. Confirm your residence position for the year you leave and the years after.

2. Plan your salary around where you will work, and keep a workday diary.

3. Time your dividends relative to your departure date and any possible return.

4. Record what profits built up before you left. It matters if you come back within five years.

5. Plan any sale or closure around your residence, Business Asset Disposal Relief and the five-year rule.

6. Think about where decisions are made, if you will be running the company alone from abroad.

Frequently asked questions

Can a non-UK resident be a director of a UK limited company?

Yes. There is no residence requirement for directors or shareholders of a UK company. Your personal tax then depends on whether you are UK resident in each tax year.

Is my director's salary taxable in the UK if I live abroad?

If you are non-resident, only the salary for work you do in the UK is taxable here, including UK board meetings. Salary for work done abroad is outside UK income tax. If you are UK resident, all of it is taxable.

Do I pay UK tax on dividends from my UK company if I live abroad?

Usually not in practice. Dividends are disregarded income for non-residents, and no tax is deducted at source, so the effective UK liability is normally nil. The five-year rule can tax them if you return.

Do I pay capital gains tax if I sell my UK company after moving abroad?

Generally not, if you are non-resident when you sell. The exceptions are companies that get most of their value from UK property, and shares you held when you left if you return to the UK within about five years.

Can moving abroad change where my company is tax resident?

It can. A UK company is always UK resident under UK law, but if it is managed from another country, that country may also treat it as resident there.

Last reviewed on 22 October 2026 by Emma McDermott, ATT, founder of Global Tax Consulting, in line with the law in force at that date: Income Tax Act 2007, section 811 and Income Tax (Earnings and Pensions) Act 2003, section 27, and the HMRC guidance cited above.