Investing in the shares of a company can be quite appealing, especially where there is a prospect of future profits and a share therein.
However, even after taxes have been paid on the profits of a company, that which remains cannot always be distributed without any tax consequences of its own.
While there might be various exemptions available for dividends from both income tax and dividends tax, this is not always guaranteed, and one needs to be well versed in the rules of legislation to ensure that you remain compliant.
We offer a session dedicated to discussing the tax impact of dividends, for both the person declaring it and the person receiving it.
This session will address matters including, but not limited to, the following:
• General:
o What constitutes a dividend (including deemed dividends and dividends in specie)
o Dividend stripping
o Low interest loans from directors and shareholders
o Value shifting arrangements
o Deemed dividends in relation to transfer pricing
o Clarifying the concept of contributed tax capital
• Considerations for the shareholder / recipient:
o Declaration of exemption responsibility
o Inclusion and exemption
o Foreign dividends (including conversion to local currency)
• Considerations for the declaring entity:
o Withholding tax responsibility
o Penalties and interest for non-payment and late payment
o Repayment of dividends from the shareholder
