The Income Tax (Manufactured Overseas Dividends) Regulations 1993

Tax treatment of approved manufactured overseas dividends paid to persons resident outside the United Kingdom U.K.

5.—(1) For the purposes of the provisions of the Tax Acts relating to the charge to tax under Schedule D, [F1 a manufactured overseas dividend] paid in the circumstances prescribed by paragraph (2) shall not be treated as an annual payment pursuant to paragraph 4(2) of Schedule 23A, and accordingly shall be paid without deduction of an amount on account of income tax.

(2) The circumstances prescribed by this paragraph are where [F1 a manufactured overseas dividend] is paid by an approved United Kingdom intermediary who, if not resident in the United Kingdom, makes the payment in the course of a trade which he carries on through a branch or agency in the United Kingdom, and either–

(a) the payment is made in circumstances where the approved United Kingdom intermediary has entered into arrangements with the Board under the Double Taxation Relief Regulations enabling him to make the payment without deduction of tax, or

(b) the payment is made to another approved United Kingdom intermediary or to an approved United Kingdom collecting agent as part of a chain of payments where–

(i) each payment in the chain is a payment by an approved United Kingdom intermediary or an approved United Kingdom collecting agent of [F1 a manufactured overseas dividend] representative of the same overseas dividend,

(ii) the maker of the last payment in the chain, if not resident in the United Kingdom, makes the payment in the course of a trade which he carries on through a branch or agency in the United Kingdom and has [F2 either] entered into arrangements under the Double Taxation Relief Regulations enabling him to make the payment without deduction of tax [F3 or makes the payment in circumstances where regulation 3(4) applies], and

(iii) each recipient of a payment in the chain has issued a notice to the maker of the payment authorising him to make the payment without deduction of tax.

Textual Amendments

F1 Words in reg. 5 substituted (28.5.1996) by The Income Tax (Manufactured Overseas Dividends) (Amendment) Regulations 1996 (S.I. 1996/1229), regs. 1, 4(a)

F2 Word in reg. 5(2)(b)(ii) inserted (6.11.1996) by The Income Tax (Manufactured Overseas Dividends) (Amendment No. 2) Regulations 1996 (S.I. 1996/2643), regs. 1, 6(a)

F3 Words in reg. 5(2)(b)(ii) inserted (6.11.1996) by The Income Tax (Manufactured Overseas Dividends) (Amendment No. 2) Regulations 1996 (S.I. 1996/2643), regs. 1, 6(b)

Commencement Information

I1 Reg. 5 in force at 1.10.1993, see reg. 1