Dividend from foreign subsidiary

S.Sowjanya (Assistant Manager(Accounts))   (57 Points)

25 December 2015  

Hi all,

I have a doubt regarding tax on dividend received from Foreign subsidiary.

If a foreign subsidiary declares dividend to wholly owned Holding Domestic company, what are the tax implications on the Foreign Subsidiary and Domestic Holding  Company.

Can the Domestic Holding company claim relief of the tax paid by Subsidiary in foreign country under DTAA. And again if the Holding company declares dividend to its shareholders, can it set off the dividend paid by subsidiary in foreign country.