How are dividends taxed from offshore companies?

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deklin888
Posts: 1
Joined: Tue Sep 13, 2011 9:40 am

How are dividends taxed from offshore companies?

Post by deklin888 »

I am starting a web-based business and I would like to legally avoid double taxation. Canada does not have a tax treaty with Belize. If I own an International corporation based in Belize, that corporation will owe no tax in Belize.

If I took dividends in Canada from the international business company in Belize, would I be taxed in Canada at my personal tax rate of about 45% or at
the dividend rate of about 30%?
JGCA
Posts: 754
Joined: Thu Nov 18, 2010 3:05 pm
Location: Montreal, QC Canada

Post by JGCA »

For you to take dividends it means you are a shareholder, as such any foreign dividend income is not allowed to claim a dividend tax credit so it is included in your income as regular income subject to your marginal rate of 45% as you state. If there is witholding tax this can be claimed as a foreign tax credit.
JG
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