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UK-US Tax Treaty for LLC Owners

The UK-US tax treaty (active since 1975, updated 2001) is among the most generous US treaties. UK-resident Wyoming LLC owners typically face 0% withholding on most FDAP.

Answer

The UK-US tax treaty (active since 1975, updated by 2001 protocol) is one of the most generous US treaties. UK-resident Wyoming LLC owners typically face 0% US withholding on most FDAP income via Form W-8BEN-E. Treaty rates: 0% on most dividends (5% to 15% in specific cases), 0% on interest, 0% on royalties in most cases. Article 7 (Business Profits) protects non-ECI business income from US tax. UK residents owe UK tax on worldwide income under standard UK rules (unless non-dom remittance basis applies).

By Zawwad, Founder & CEO, WyomingLLC by Topslice LLC.

Last updated May 20, 2026

Key treaty articles

  • Article 7 (Business Profits): business profits taxable only in country of residence unless US permanent establishment
  • Article 10 (Dividends): 0% on most dividends; 5% if 10%+ corporate parent; 15% otherwise
  • Article 11 (Interest): 0% on most interest
  • Article 12 (Royalties): 0% on most royalties
  • Article 22 (Limitation on Benefits): anti-treaty-shopping provisions; must be a "qualified person"

UK tax on LLC income

  • UK resident-domiciled taxpayers pay UK tax on worldwide income including LLC pass-through
  • UK non-doms may use remittance basis (only UK-remitted income taxed)
  • UK foreign tax credit available for any US tax paid
  • Consult UK CA for proper treatment of US LLC income

How to claim treaty benefits

  1. File Form W-8BEN-E with each US payer
  2. Line 5: Country of residence = United Kingdom
  3. Part III: Cite Article 10, 11, or 12
  4. Line 8: LLC EIN as US TIN
  5. Line 9: UK UTR or NINO as foreign TIN (optional)
  6. Renew every 3 years

Frequently asked questions

Is the UK-US treaty active?
Yes. Active since 1975, updated by 2001 protocol. Still in force.
What is the dividend withholding rate for UK residents?
0% on most dividends. 5% if corporate parent with 10%+ ownership. 15% on certain other cases.
Do I owe UK tax on LLC income?
Yes for UK resident-domiciled taxpayers. UK non-doms may use remittance basis.
Is UK considered a 'qualified person' under LOB?
Most UK residents qualify. Specific limitations apply to certain entity types.

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