Commentary

D9.703A Manufactured payments—Treatment of recipient

Corporate tax
Corporate tax | Commentary

D9.703A Manufactured payments—Treatment of recipient

Corporate tax | Commentary

D9.703A Manufactured payments—Treatment of recipient

The tax treatment of manufactured payments received differs depending upon whether the recipient is a company or individual, as detailed below.

Corporates

Manufactured dividend

Where a company has a manufactured dividend relationship (D9.701) and pays a manufactured dividend under the arrangement, the general rule is that the (corporate) recipient is treated as receiving a dividend on the shares1.

This rule does not however apply:

  1.  

    •     if the payment is brought into account in calculating the profits of a trade carried on by the recipient2

  2.  

    •     for the purposes of determining entitlement to double taxation relief in respect

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