Report No. 12
Tax Deemed to have been Paid on Dividends
Notes to clause 246
Existing section 18(5) deals in part with credit to be given in respect of the tax deemed to have been paid on dividends. Existing section 49B also contains some provisions on income-tax. All these provisions have been combined in this clause, without any change of substance. The drafting changes made are consequential on the breaking up of section 18(5).
The opening portion of section 49B(1), i.e., the words "where any dividend has been paid to any of the persons specified in section 3" etc., has been omitted, is unnecessary, particularly in view of the fact that section 3 as proposed in the draft does not enumerate the chargeable entities.
A proviso has been added to deal with cases where the share is held by partners. The existing proviso regarding persons not constituting partnership may be compared.