C1C2Part 2Double taxation relief
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)
C2CHAPTER 2Double taxation relief by way of credit
Taking account of tax underlying dividends that is not foreign tax
63Non-UK company dividend paid to 10% investor: relief for UK and other tax
1
If condition A is met, and one of conditions B and C is met, subsection (5) applies for the purpose of allowing, under the arrangements, credit against corporation tax in respect of a dividend paid by a company resident outside the United Kingdom (“the overseas company”) to another company (“the recipient company”).
2
Condition A is that the recipient company—
a
controls directly or indirectly, or
b
is a subsidiary of a company which controls directly or indirectly,
at least 10% of the voting power in the overseas company.
3
Condition B is that the recipient company is resident in the United Kingdom.
4
Condition C is that—
a
the recipient company is resident outside the United Kingdom, but
b
the dividend forms part of the profits of a permanent establishment of the recipient company in the United Kingdom.
5
There is to be taken into account, as if it were tax payable under the law of the territory (“territory R”) in which the overseas company is resident—
a
any income tax or corporation tax payable by the overseas company in respect of its profits, and
b
any tax which, under the law of any territory outside the United Kingdom other than territory R, is payable by the overseas company in respect of its profits.
6
For the purposes of subsection (2), one company (“S”) is a subsidiary of another company (“P”) if P controls, directly or indirectly, at least 50% of the voting power in S.
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))