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HMRC internal manual

Double Taxation Relief Manual

Macedonia: Dividends

The Macedonian tax deducted from dividends at the agreement rate of 15 per cent (5 per cent if the beneficial owner is a United Kingdom company which directly controls at least 10 per cent of the capital of the company paying the dividend) qualifies for credit as a direct tax (see INTM164010(c)).

However, the dividend will be exempt from tax in Macedonia if the United Kingdom beneficial owner is either a company that has owned at least 25 per cent of the Macedonian company paying the dividend for 12 months ending on the date of payment or is a pension scheme.

The reduced rate does not apply if the dividends are effectively connected (see INTM153110 fifth sub-paragraph) with a business carried on through a permanent establishment which the recipient has in Macedonia.

A United Kingdom company controlling, directly or indirectly, at least 10 per cent of the voting power of the Macedonian company paying the dividend is entitled, under Article 22(2)(b), to credit for underlying tax (see INTM164010(d)).