Taxation (International and Other Provisions) Act 2010 (c. 8)

Part 2 U.K. Double taxation relief

Modifications etc. (not altering text)

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)

CHAPTER 2 U.K. Double taxation relief by way of credit

Taking account of foreign tax underlying dividends U.K.

61 Calculation if section 58 does not apply U.K.

A calculation under this section (see section 57(2)(b)) is as follows—

• Step 1 Calculate the amount of the foreign tax borne on the relevant profits by the body corporate paying the dividend.

• Step 2 Calculate how much of that amount is properly attributable to the proportion of the relevant profits represented by the dividend.

• Step 3 If under the law of the non-UK territory the dividend has been increased for tax purposes by an amount to be—

  • set off against the recipient's own tax under that law, or

  • paid to the recipient so far as it exceeds the recipient's own tax under that law,

  calculate the amount of the increase.

• Step 4 The amount of underlying tax to be taken into account as a result of the provision mentioned in section 57(1) is the amount given by the calculation at Step 2 but reduced by any amount calculated at Step 3.