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HMRC internal manual

Double Taxation Relief Manual

Barbados: Dividends

Under Barbados domestic law, a withholding tax may be levied on dividends paid by Barbados companies. However, a resident of the United Kingdom who is subject to United Kingdom tax on a dividend paid by a Barbados company is entitled to exemption from such withholding tax under Article 9(4) as amended by the further agreement.

Exemption is not given if the dividend is effectively connected with (see INTM153110 fifth subparagraph) a business carried on by the United Kingdom resident recipient through a permanent establishment in Barbados.

Where the recipient of a dividend is a United Kingdom company controlling, directly or indirectly, not less than 10 per cent of the voting power in the Barbados company paying the dividend, it will be entitled to relief for the underlying tax (see INTM164010) (Article 22(1)(b)).