Corporation Tax Act 2010 section 792

Company receiving manufactured overseas dividend from UK resident etc

Section 792 deals with the corporation tax treatment of manufactured overseas dividends (MODs) received by a company, where income tax has been deducted at source by the payer.

• When a company receives a manufactured overseas dividend from which income tax has been deducted, special rules apply to how that payment is treated for corporation tax purposes.
• The company is treated as receiving an amount equal to the gross amount of the manufactured overseas dividend, not just the net amount after tax deduction.
• The company is also treated as having paid overseas tax on that dividend, which may give rise to relief for foreign tax suffered.
• These rules apply where the payer is required to deduct income tax under the relevant provisions of the Income Tax Act, typically because the payer is UK resident.