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HMRC internal manual

Double Taxation Relief Manual

From
HM Revenue & Customs
Updated
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DT: Jamaica: double taxation agreement, Article 8: Dividends

  1.  

 

 

  1. Dividends derived from a company which is a resident of the United Kingdom by a resident of Jamaica may be taxed in Jamaica.
  2. Where a resident of Jamaica is entitled to a tax credit in respect of such a dividend under paragraph (2) of this Article tax may also be charged in the United Kingdom, and according to the laws of the United Kingdom, on the aggregate of the amount or value of that dividend and the amount of that tax credit at a rate not exceeding 15 per cent.
  3. Save as aforesaid dividends derived from a company which is a resident of the United Kingdom and which are beneficially owned by a resident of Jamaica shall be exempt from any tax in the United Kingdom which is chargeable on dividends.

 

  1. A resident of Jamaica who receives dividends from a company which is a resident of the United Kingdom shall, subject to the provisions of paragraph (3) of this Article and provided he is the beneficial owner of the dividends, be entitled to the tax credit in respect thereof to which an individual resident in the United Kingdom would have been entitled had he received those dividends, and to the payment of any excess of such credit over his liability to United Kingdom tax.
  2. Paragraph (2) of this Article shall not apply where the beneficial owner of the dividend is a company which

 

 

  1. either alone or together with one or more associated companies controls directly or indirectly at least 10 per cent of the voting power of the company paying the dividend; or
  2. is entitled in computing the amount of credit to be allowed against Jamaican tax in respect of tax payable in the United Kingdom to credit in respect of the United Kingdom tax payable on the profits out of which the dividend is paid.

For the purpose of this paragraph two companies shall be deemed to be associated if one is controlled directly or indirectly by the other, or both are controlled directly or indirectly by a third company.

  1. Dividends derived from a company which is a resident of Jamaica by a resident of the United Kingdom may be taxed in the United Kingdom. Such dividends may also be taxed in Jamaica but where such dividends are beneficially owned by a resident of the United Kingdom the tax so charged shall not exceed-

 

 

  1. 22½ per cent of the gross amount of the dividends if the beneficial owner is a company and it controls directly or indirectly at least 10 per cent of the voting power in the company paying the dividends;
  2. in all other cases 15 per cent of the gross amount of the dividends.

 

  1. The preceding paragraphs of this Article shall not affect the taxation of the company in respect of the profits out of which the dividends are paid.
  2. The term `dividends` as used in this Article means income from shares, or any other item (other than interest or royalties relieved from tax under the provisions of Article 9 or the provisions of Article 10 of this Agreement) which, under the law of the territory of which the company paying the dividend is a resident, is treated as a dividend or distribution of a company.
  3. The provisions of paragraphs (1) and (2), or as the case may he, paragraph (4) of this Article shall not apply where a resident of one of the territories has in the other territory a permanent establishment and the holding by virtue of which the dividends are paid is effectively connected with the business carried on through such permanent establishment. In such a case the provisions of Article 5 shall apply.
  4. Where a company which is a resident of one of the territories derives profits or income from the other territory, that other territory may not impose any tax on the dividends paid by the company to persons who are not residents of that other territory or subject the company’s undistributed profits to a tax on undisturbed profits, even if the dividends paid or the undistributed profits consist wholly or partly of profits or income arising in such other territory.