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A shareholder inquired which tax year should be used to declare dividends from previous years received following a separation judgment. The DGT ruled that dividends must be attributed to the period in which they became due according to the distribution agreement, rather than when they were actually paid.
This ruling clarifies the timing of tax liability for dividends, ensuring that income is taxed in the period it was legally due, preventing taxpayers from deferring tax liability through delayed payments.
The tax team reviews your specific situation.
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