Directive 96/2011 / EU (the so-called mother-daughter directive) provides a particularly advantageous regime for companies “mothers” who receive dividends from companies “daughters” resident in an EU member state other than that of residence of the “mother”.
The EU directive in fact provides that dividends distributed to the parent company are exempt from taxation if the distribution was not deductible by the subsidiary company. Furthermore, the directive also states that dividends must not be subject to withholding tax at the time of distribution.
The requirements for accessing the tax advantages provided for by the mother-daughter directive are as follows:
– the entities involved must be joint stock companies
– the parent company must hold a direct stake in the daughter's capital of not less than 10%
– companies must be resident in an EU member state
– companies must be subject to taxation in the state of residence
– the participation must be held for at least two years
The documentation necessary to request the application of the directive and therefore the exemption from withholding tax on dividends, present on the website of the Revenue Agency, is available in the attachment.