Dividend taxation: treaty limits source-state withholding where recipient is beneficial owner, with exceptions for permanent establishments. Dividends paid to a resident of the other Contracting State may be taxed in the recipient's State but may also be taxed in the source State; when the recipient is the beneficial owner the source State's tax is capped at reduced withholding rates, without affecting corporate taxation of profits. Reduced source taxation does not apply where the beneficial owner's holding is effectively connected with a permanent establishment or fixed base in the source State, in which case rules for business profits or independent personal services apply.
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: treaty limits source-state withholding where recipient is beneficial owner, with exceptions for permanent establishments.
Dividends paid to a resident of the other Contracting State may be taxed in the recipient's State but may also be taxed in the source State; when the recipient is the beneficial owner the source State's tax is capped at reduced withholding rates, without affecting corporate taxation of profits. Reduced source taxation does not apply where the beneficial owner's holding is effectively connected with a permanent establishment or fixed base in the source State, in which case rules for business profits or independent personal services apply.
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