The distribution of profits between corporations resident in different jurisdictions gives rise to significant tax planning opportunities for multinational enterprises. As cross-border transactions between corporations grow in number and complexity, the question of how a profit distribution is classified for corporate income tax purposes becomes increasingly important, particularly in the context of issues such as double taxation, non-taxation and tax neutrality. This unique and practical work covers the rules determining which transactions may be classified and therefore taxed as dividend income and how classification conflicts may be resolved. The author examines the classification of various inter-corporate transactions, including:
• Payments made under dividend-stripping arrangements.
• Fictitious profit distributions.
• Economic benefits in the context of transfer pricing.
• Returns on debt-equity hybrids.
• Interest payments in thin capitalization situations and distributions following liquidation.
The analysis of each transaction refers to international tax law. Most weight is given to tax treaties and EU tax law. The approaches adopted in different states’ national tax law are covered by a more general analysis. The comprehensive coverage and practical nature of The International Tax Law Concept of Dividend make it an essential acquisition for tax practitioners, researchers and tax libraries worldwide.
The distribution of profits between corporations resident in different jurisdictions gives rise to significant tax planning opportunities for multinational enterprises. As cross-border transactions between corporations grow in number and complexity, the question of how a profit distribution is classified for corporate income tax purposes becomes increasingly important, particularly in the context of issues such as double taxation, non-taxation and tax neutrality. This unique and practical work covers the rules determining which transactions may be classified and therefore taxed as dividend income and how classification conflicts may be resolved. The author examines the classification of various inter-corporate transactions, including: