Dutch Witholding Tax on Dividends

Hello, My UK Ltd company holds 5% shares in a Dutch company. The Dutch company deducts 15% WHT from dividends - how do I account for this in UK Ltd company? As far as I can tell, the dividend would not be subject to UK corporation tax. Can I offset the Dutch WHT from any UK corporation tax payable on trading activities? Or should I keep it on the balance sheet as a deferred tax asset that can perhaps be utilised against any capital gains tax when I dispose of the shares? Or, worst case, do I have to just expense the WHT? Thanks.

Hi,

There is no tax liability in the UK so no double taxation relief  can be claimed.

The dividends would go into the accounts as a net figure and then an adjustment would need to be made for the same amount so that it does not get taxed in the computations, as they are exempt. You can see guidance here:

CTM02060 - Corporation Tax: computation of income: dividends and other distributions received

You can see the Netherlands tax treaty here:

Netherlands: tax treaties

Thank you.