Dividend to Hong Kong

One of our clients is based in Hong Kong. The Hong Kong holding company owns several operations abroad, including in the Netherlands. The client wishes to have certainty about the applicable dividend withholding tax rate on dividends to be paid by the Dutch company to the Hong Kong corporate shareholder.

At present we are preparing a request for the Dutch tax authorities, and will ask them to confirm that the Dutch company can apply an exemption of dividend withholding tax on the basis of the tax treaty. Such confirmation provides for certainty and could save client a fair amount of dividend withholding tax. Hopefully we can make our client happy (again)!