The Income Tax (Manufactured Overseas Dividends) (Amendment) Regulations 2003

Explanatory Note

(This note is not part of the Regulations)

These Regulations amend the Income Tax (Manufactured Overseas Dividends) Regulations 1993 (S.I. 1993/2004) (“the principal Regulations”). The main purpose of the amendments is to remove the requirements for persons making payments of manufactured overseas dividends (within the meaning given by paragraph 4(1) of Schedule 23A to the Income and Corporation Taxes Act 1988 (c. 1)) to account for and pay tax in respect of such payments where payment is to persons who are not United Kingdom recipients (within the meaning given by paragraph 4(3A) of that Schedule). The amendments also take into account the general replacement of references in tax legislation to “branch or agency” by references to “permanent establishment” (see section 153 of the Finance Act 2003 (c. 14)).

Regulation 1 provides for citation and commencement.

Regulation 2 introduces the amendments to the principal Regulations.

Regulation 3 amends regulation 2 (interpretation).

Regulation 4 amends regulation 3 (prescribed rates of relevant withholding tax).

Regulation 5 amends regulation 4 (tax treatment of approved manufactured overseas dividends paid to approved United Kingdom intermediaries or approved United Kingdom collecting agents).

Regulation 6 amends regulation 5 (tax treatment of approved manufactured dividends paid to persons resident outside the United Kingdom).

Regulation 7 amends regulation 6 (retention and record of notices given under regulations 4 and 5).

Regulation 8 amends regulation 7(2) (disapplication of paragraph 4(3) of Schedule 23A).

Regulation 9 amends regulation 8 (tax treatment of manufactured overseas dividends to which regulations 4, 5 and 7 apply – further provision).

Regulation 10 amends regulation 9A (offsetting of tax by overseas dividend manufacturers who are not United Kingdom intermediaries).

Regulation 11 amends regulation 10 (matching of dividends and manufactured overseas dividends).

Regulation 12 amends regulation 14 (records to be kept in respect of certain manufactured overseas dividends paid without deduction of tax).