Controlled Foreign Company

Controlled Foreign Company (CFC) Rules
1    The Income Tax Law, through a Minister of Finance Decree,      determines the time of receipt of dividend by a resident taxpayer on capital participation in a business entity abroad other than a business entity that sells its shares on a stock exchange in these cases:
·    The amount of capital participation of the resident taxpayer  is a minimum of 50% (fifty percent) of the number of paid-up shares; or
·    Jointly with other resident taxpayer(s) owns a minimum capital participation of 50% (fifty percent) of the number of paid-up shares.
2    The time of receipt of dividend by a resident taxpayer with the above conditions is as follows:
·    in the fourth (4th) month after the deadline for the submission of the Annual  Corporate Income Tax Return of the foreign entity for the  fiscal year concerned; or
·    in the seventh (7th) month after the end of a fiscal year if such foreign entity does not have any obligation to submit an Annual Corporate Income Tax Return or if there is no deadline for the submission of the Annual Corporate Income Tax Return.
3    The amount of dividend shall be the total amount of dividend that the local taxpayer is entitled to, from the profit after tax, according to its capital participation in the foreign entity other than a business entity that sells its shares on stock exchange.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s