Article 11 - Dividends - Tanzania (Old - Effective upto 31-3-2012)

Article 11 : Dividends 1. Dividends paid by a company which is resident of a Contracting State to a resident of the other Contracting State may be taxed in that other State. 2. However, such dividends may also be taxed in the Contracting State of which the company paying the dividends is a resident, and according to the law of that State, but the tax so charged shall not exceed: (a) 10 per cent of the gross amount of the dividends if the recipient is a company which owns at least 10 per cent of the shares of the company paying the dividends during the period of six months immediately preceding the date of payment of the dividends; (b) 15 per cent of the gross amount of the dividends in all other cases. 3. The term "dividends" as used in this Article means income from shares or other rights, not being debt-claims, participating in profits as well as income from other corporate rights assimilated to income from shares or any other item which is deemed to be a dividend or distribution of a company by the taxation law of the Contracting State of which the company making the distribution is a resident. 4. The provisions of paragraphs 1 and 2 shall not apply if the recipient of the dividends being a resident of a Contracting State, carries on business in the other Contracting State of which company paying the dividends is a resident, through a permanent establishment situated therein or performs in that other State professional services from a fixed base situated therein and the holding in respect of which the dividends are paid is effectively connected with such permanent establishment of fixed base. In such a case the provisions of Article 7 or Article 16, as the case may be, shall apply. 5. Where a company which is a resident of a Contracting State, derives profits or income from the other Contracting State, that other state may not impose any tax on the dividends paid by the Company to persons who are not resident of that other State, or subject the company's undistributed profits to a tax on undistributed profits, even if the dividends paid or the undistributed profits consist wholly or partly of profits or income arising in the other State.