Companies can distribute some of their profits as dividend to their shareholders. Dividends are subject to tax. The general rate of dividend tax is 15%.
Withholding and deduction of dividend tax
Dividend tax is withheld from the profit distributed to shareholders. Shareholders can deduct the withholding from the balance payable on their income tax or corporation tax returns.
If a company receives a dividend on the shares it owns in another company it can deduct the dividend tax from the balance of its corporation tax payable. A private individual can deduct it from the balance of income tax payable.
Dividend tax exemption or refund
In some circumstances, a company may be entitled to partial or full exemption from dividend tax or to a dividend tax refund.
Central shareholder register
To clarify who holds shares in a company and combat fraud, the government intends to introduce a central shareholder register on 1 January 2015.
Shareholders, civil-law notaries and government agencies will be able to inspect the central shareholder register. It will be kept by the Commercial Register of the Chamber of Commerce.