INTM164156 - UK residents with foreign income or gains: dividends

Accounts deductions for dividends

The amount of relief for underlying tax is calculated according to the rules contained in ICTA88/S799(1). In some situations, a company may pay a dividend, and make a deduction in arriving at relevant profits calculated by reference to that dividend. Where this is the case, that dividend cannot represent a proportion of relevant profits and no relief is available for underlying tax.