Taxation of dividends: source state withholding capped when beneficial owner is resident of the other state, with PE exception.

Taxation of cross border dividends under the Model DTAA limits source state withholding where the beneficial owner is resident of the other Contracting State, imposing capped tax rates based on the character of the beneficial owner and requiring mutual agreement on application; these caps do not affect taxation of the distributing company's profits, and do not apply where the holding is effectively connected with a permanent establishment.

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