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HMRC internal manual

International Manual

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HM Revenue & Customs
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DT Agreements: Norway - Income from a UK source paid to a resident of Norway

UK dividends paid to a resident of Norway - portfolio investor

Before 6 April 2001 - 1985 Convention

The double taxation convention provides for payment of the excess of UK tax credit afterretention of 15% of the aggregate of UK dividend plus tax credit to thebeneficial owner of the dividends who is a resident of Norway. But for dividends paidsince 6 April 1999 there is no tax credit to pay. See INTM343520.

The anti-dividend stripping provisions (see Article 10(6)) apply where a resident ofNorway owns 10% or more of the class of shares from which the dividend ispaid. However, this article does not allow payment of tax credit to a company thatcontrols 10% or more of the voting power in the UK company, and thusbecomes a direct investor – see INTM359035. This means that you will only have tomake dividend stripping enquiries about portfolio holdings in exceptional cases where thefollowing conditions are met

  • the claim is for dividends on non-voting shares where the claimant holds more than 10% of those shares, and
  • the claimant does not control 10% or more of the voting shares.

The replies to the relevant questions on the NOR 3/Individual/Credit and the NOR3/Company/Credit will enable you to decide whether dividend stripping enquiries arerequired.

See INTM343550 for an explanation of dividend stripping.

After 6 April 2001 - 2000 Convention

There is no provision for payment of the tax credit attached to UK dividends.