INTERNATIONAL TAX PLAZA - Article 37, Paragraph 2

Details: Published: 20 February 2022

An ultimate parent entity of an MNE group that is subject to a deductible dividend regime shall reduce, up to zero, for the fiscal year, its qualifying income by the amount that it distributes as deductible dividend within 12 months after the end of the fiscal year, provided that:

(a) the dividend is subject to tax in the hands of the recipient for a taxable period that ends within 12 months after the end of the fiscal year at a nominal rate that equals or exceeds the minimum tax rate; or

(b) it can be reasonably expected that the total amount of covered taxes and taxes paid by the recipient on such dividend equals or exceeds the amount equal to that income multiplied by the minimum tax rate.

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