Chartered Accountants & Tax Specialist
General update by IBBZ Accounting on latest tax news, business growth and technology tips.
RWT on dividends between companies
With amendments being made to sections RE 2(5), this now limits the definition of “resident passive income”. This section excludes fully imputed dividends paid to a corporate shareholder if the paying company chooses to exclude the dividend from the definition.
This will allow a company to opt out of withholding RWT on a fully imputed dividend paid to another company.
The above amendments were needed because of company tax rate being lowered from 33% to 28%. Dividends were effectively overtaxed by the amount of RWT withheld.Continue reading