Dividend taxation under the treaty: source State withholding limited; effective connection with PE shifts taxation to business profit rules. Article 10 permits taxation of dividends by the recipient's State and also by the State of the distributing company subject to treaty limits; when the beneficial owner resides in the other Contracting State the distributing State's withholding tax is capped or, for Malta, limited to the domestic tax on the profits from which the dividends are paid, while the company's taxation on its profits is preserved. Dividends are broadly defined and the Article excludes application where dividends are effectively connected with a permanent establishment or fixed base, invoking rules on business profits or independent personal services instead.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Dividend taxation under the treaty: source State withholding limited; effective connection with PE shifts taxation to business profit rules.
Article 10 permits taxation of dividends by the recipient's State and also by the State of the distributing company subject to treaty limits; when the beneficial owner resides in the other Contracting State the distributing State's withholding tax is capped or, for Malta, limited to the domestic tax on the profits from which the dividends are paid, while the company's taxation on its profits is preserved. Dividends are broadly defined and the Article excludes application where dividends are effectively connected with a permanent establishment or fixed base, invoking rules on business profits or independent personal services instead.
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