The Tax Treaty between the US and the UK provides that dividends shall not be taxed in the contracting state of which the company paying the dividends is a resident if the beneficial owner of the dividends is a pension scheme resident in the other contracting state, provided that such dividends are not derived from the carrying on of business by the pension scheme.

In order to provide certainty for taxpayers, the competent authorities of the United States and the United Kingdom have reached agreement on the types of UK arrangements are "pension schemes" and that they are treated as the beneficial owners of dividends paid to them by U.S. corporations.

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...back to 14 April 2005


Further information:
Agreement Identifies U.K. Pension Arrangements for Tax Treaty Benefits
Competent Authority Agreement