BIR Ruling

October 14, 1976 Tax on Cash Dividends of Domestic Corporations to be Remitted to a Foreign Parent Corporation This refers to your letter dated August 31, 1976, requesting a certification from this Office that the dividends which you will remit to the PHA Corporation is subject to withholding tax at the rate of 15%, instead of 35%. It appears that you are a domestic corporation; that 99.99% of your shares is owned by the aforenamed recipient corporation; and that said corporation is a nonresident foreign corporation domiciled in New York, U.S.A. In view thereof, and considering that under the present provisions of the U.S. Federal Code, the amount of tax deemed paid on such dividends, and accordingly, to be credited against U.S. tax on said dividends, exceeds the 20% requirement of Presidential Decree No. 369, this Office hereby certifies that the dividends which you will remit to PHA Corporation, domiciled at New York, U.S.A., are subject to withholding tax at the rate of 15% only. (BIR Ruling No. 76-004 dated July 19, 1976). cdtech