Dividend taxation limited by source-state withholding cap for beneficial owners; PE-connected holdings follow business profit rules. Dividends paid to a resident of the other Contracting State may be taxed in the recipient's State; the source State may also tax them but, if the recipient is the beneficial owner, source taxation of the gross dividend is limited by a withholding ceiling with application to be agreed by competent authorities. The limitation does not affect corporate taxation of profits. Dividends include income from shares and similar profit-participating rights. The withholding limitation 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 business profits or independent services rules govern.
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 limited by source-state withholding cap for beneficial owners; PE-connected holdings follow business profit rules.
Dividends paid to a resident of the other Contracting State may be taxed in the recipient's State; the source State may also tax them but, if the recipient is the beneficial owner, source taxation of the gross dividend is limited by a withholding ceiling with application to be agreed by competent authorities. The limitation does not affect corporate taxation of profits. Dividends include income from shares and similar profit-participating rights. The withholding limitation 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 business profits or independent services rules govern.
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