June 8, 2021
12.00 p.m. to 1.00 p.m. CET
3.30 p.m. to 4.30 p.m. IST
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In a significant overhaul of the Indian dividend taxation regime, the classical withholding tax on dividends has replaced the erstwhile distribution tax (DDT) with effect from April 1, 2020.
This offers an opportunity for an Indian company to withhold taxes at the beneficial Tax Treaty rates while paying dividend to non-resident shareholders including Foreign Portfolio Investors (FPIs). Although the India-Netherlands Tax Treaty prescribes a beneficial tax rate of 10 per cent for beneficial owners of dividends vis-à-vis the Indian withholding tax rate of 20 per cent (plus applicable surcharge and cess), the Most‑Favored-Nation clause (MFN) in the Protocol paves the way for a further reduced rate of 5 per cent. An Indian High Court recently rendered a favorable ruling on the applicability of the reduced 5 per cent rate under the MFN clause.
This is a significant ruling providing a much-needed impetus to cash repatriation to businesses in this pandemic-afflicted world. It also reinforces hope for pursuing significant refunds for dividends paid in the past, by way of reclaiming the ‘excess’ DDT - a proposition on which favorable decisions were recently issued by various Tax Tribunals.
Against this background, we are pleased to invite you to a webinar on exploring dividend as a repatriation option, especially in the context of the benefit under the India‑Netherlands Tax Treaty, the beneficial ownership test and the MFN clause and recouping the excess taxes paid on historic dividends.
The webinar will be conducted by Cees van der Helm, Partner at KPMG Meijburg & Co., Himanshu Parekh, Partner and Head, Corporate and International Tax at KPMG in India and Nidhi Maheshwari, Chartered Accountant and will be followed by a Q&A session.
n order to facilitate a productive Q&A session, would you please send us your questions before the webinar, by clicking on the following link:
Send us your questions
Please click here for registration
We look forward to your participation in the webinar!
Partner and Head, Corporate
and International Tax, KPMG- India
|Cees van der Helm
Partner, KPMG Meijburg & Co.