How a few Zoom calls from Spain nearly moved a UK company’s tax home

“We’re 100% UK.”

That’s what the founder told buyers during due diligence. UK company, UK customers, UK auditors—the lot.

Except for one detail: the CEO spent the summer in Spain, chairing board meetings on Zoom, negotiating a financing term sheet, and approving the new incentive plan—all while physically in Spain. Harmless? That tiny wrinkle almost turned into a multi-million pound problem.

This is the story of how “work from anywhere” accidentally challenged corporate tax residency and permanent establishment—and how to stop it happening to you.

The summer that changed the facts

• HoldCo UK Ltd owned OpCo UK Ltd. Group CFO and legal counsel were in London. 
• The CEO (also Chair) decamped to Spain for 10 weeks.
• During that period they:
  • Chaired two board meetings where the annual plan and a refinancing package were approved;
  • Negotiated key customer contracts and signed a binding heads of terms;
  • Issued written resolutions approving a share buy-back.

All governance docs named the CEO as meeting chair and decision maker. The metadata on drafts showed edits during CEST business hours. The investors’ data room had… everything.

The red flag in diligence

The buyer’s tax team asked a brutal, simple question:

“Where were central decisions actually made?”

If the “central management and control” of a company looks like it took place outside the UK—even temporarily—Spain could argue the company is tax resident there under the “sede de dirección efectiva” / place-of-effective-management test, or at least that a permanent establishment exists. That drags profits (and headaches) into a second tax net and invites scrutiny from the Agencia Tributaria (AEAT).

Risk profile they saw:

• Board decisions originating while the Chair was in Spain;
• Strategic negotiations conducted from Spain;
• Contracts signed while abroad, evidenced by email and e-sign logs;
• No board protocol defining where decisions are deemed to occur.

Result: the buyer paused, demanded warranties, price chips, and a tax indemnity. The deal timetable wobbled.

What we changed—fast

We didn’t move the CEO; we moved the decision-making architecture back to the UK.

1. Board protocol & standing orders
   • Defined that board deliberation and approval occurs at the noticed meeting location (London), chaired by a UK-resident director physically in the UK.
   • If a director dials in from abroad (Spain or elsewhere), they’re present but do not locate the decision there.

1. Agenda triage
   • High-stakes matters (financing, M&A, equity awards) deferred to UK-chaired meetings.
   • Operational updates allowed anytime, anywhere.

1. Company secretarial hygiene
   • Minutes captured who was physically where; the chair summarised deliberations and explicitly located the decision in the UK.
   • Action logs separated decision (UK) from execution (anywhere).

1. Signature & execution playbook
   • Wet-ink or e-sign from the UK for major contracts; if not possible, executed by a UK-based authorised signatory under a board-approved mandate.

1. Travel + governance tracker
   • A lightweight location register for directors (not just for personal tax days, but for governance events).
   • Calendared reminder: “If it’s strategy or capital—do it from the UK.”

The buyer’s concerns eased. The indemnity narrowed. The price chip vanished.

The 7-question “WFH, but legal” checklist

1. Who chairs key meetings—and where are they, physically?
2. Are high-value approvals (debt, equity, M&A, LTIP) always decided at a UK-chaired, UK-located board?
3. Do minutes clearly record location of the decision (not just attendees)?
4. Do you have a signature policy routing execution to UK-based signatories for strategic docs?
5. Can you separate ‘discuss’ from ‘decide’ (workshops anywhere; decisions in the UK)?
6. Are non-UK directors’ activities kept preparatory/auxiliary when abroad (to avoid PE exposure)?
7. Do you keep a director location log tied to board and committee calendars?

If you can’t tick at least five, your governance is telling a different story than your pitch deck.

Founder myths that cause real tax pain

• “We’re a UK company, so obviously we’re UK-resident.”
  Incorporation helps, but where decisions live can still be decisive.
• “Zoom makes location irrelevant.”
  Not to tax authorities, buyers, or their lawyers—including AEAT.
• “Minutes are formalities.”
  They’re evidence. If they don’t locate decisions, someone else will.
• “We can fix it at exit.”
  Buyers price risk into the deal—long before completion.

The takeaway

“Work from anywhere” is brilliant—until your company starts being taxed from anywhere. Put simple guardrails around who decides what, where, and you’ll keep your tax home where you want it, protect value at exit, and sleep better on your next working holiday.

Any questions? Mail to angelo@vectigalistax.co.uk