Dividend tax limitation: source-state withholding capped when recipient is the beneficial owner, with PE exceptions. Dividends paid by a resident company to a resident of the other Contracting State may be taxed by the recipient's State, while the payer's State may also tax them but, if the recipient is the Beneficial Owner, tax is capped at 15 per cent of the gross amount. The 15 per cent limit is inapplicable where the recipient's holding is effectively connected with a Permanent Establishment or Fixed Base in the payer's State, in which case rules on business profits or independent personal services apply; source States may not tax undistributed profits.
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 tax limitation: source-state withholding capped when recipient is the beneficial owner, with PE exceptions.
Dividends paid by a resident company to a resident of the other Contracting State may be taxed by the recipient's State, while the payer's State may also tax them but, if the recipient is the Beneficial Owner, tax is capped at 15 per cent of the gross amount. The 15 per cent limit is inapplicable where the recipient's holding is effectively connected with a Permanent Establishment or Fixed Base in the payer's State, in which case rules on business profits or independent personal services apply; source States may not tax undistributed profits.
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