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HMRC internal manual

International Manual

UK residents with foreign income or gains: corporation tax: Dividends: voting power reduced after 1st April 1972: extension of unilateral relief

TIOPA10 extends unilateral relief for underlying tax (see INTM164360) to a company claiming the relief which controls, directly or indirectly, or is a subsidiary of a company which controls, directly or indirectly, less than 10 per cent of the voting power in the foreign company paying the dividend where

a. Section 15 the control of the voting power was reduced below 10 per cent on or after 1 April 1972, or

b. Section 16 the voting power in the foreign company was acquired on or after 1 April 1972 in exchange for voting power in another company and the UK recipient of the dividend had been entitled to relief for underlying tax before the exchange in respect of its dividend from the other company.

Relief under Sections 15 or 16 is available only in respect of dividends paid (within the meaning of CTA10/S1168 ) on or after 1 April 1972 (see TIOPA10/SCH9/PARA14).

This relief is now very rarely claimed. Any case where it is not clear whether or not relief is due should be referred to CTIAA Business International (Outward Investment Team).