Section 14 Rule 6: credit for underlying tax on dividend paid to 10% associate of payer

(1)

This section applies for the purposes of section 12(1).

(2)

Credit under section 9 for overseas tax on a dividend paid by a company (“P”) resident in the territory is allowed if conditions A and B are met.

(3)

Condition A is that—

(a)

the recipient of the dividend is a company resident in the United Kingdom, or

(b)

the recipient is a company resident outside the United Kingdom but the dividend forms part of the profits of a permanent establishment of the recipient in the United Kingdom.

(4)

Condition B is that the recipient—

(a)

directly or indirectly controls, or

(b)

is a subsidiary of a company which directly or indirectly controls,

at least 10% of the voting power in P.

(5)

For the purposes of subsection (4), the recipient is a subsidiary of another company if the other company controls, directly or indirectly, at least 50% of the voting power in the recipient.

Notes on Part 2

Modifications

C1: Pt. 2 modified by 1988 c. 1, Sch. 19ABA paras. 26-28 (as inserted (with effect in accordance with s. 381(1) of the amending Act) by Taxation (International and Other Provisions) Act 2010 (c. 8), s. 381(1), Sch. 8 para. 34(3) (with Sch. 9 paras. 1-9, 22))
C2: Pt. 2 applied by 2010 c. 4, s. 269DL(6) (as inserted (with effect in accordance with Sch. 3 Pt. 3 of the amending Act) by Finance (No. 2) Act 2015 (c. 33), Sch. 3 para. 1)