Dividends treaty relief: source withholding limited for beneficial owners, subject to permanent establishment connection. Dividends paid by a resident company to a resident of the other Contracting State may be taxed in the recipient's State, while the source State may also ... Summary
Dividends treaty relief: source withholding limited for beneficial owners, subject to permanent establishment connection.
Dividends paid by a resident company to a resident of the other Contracting State may be taxed in the recipient's State, while the source State may also tax such dividends but, where the recipient is the beneficial owner, source taxation is limited by treaty to a specified maximum withholding rate; this limitation does not affect taxation of the company's profits. Reduced source treatment is inapplicable 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 personal services rules apply.
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