Bloomberg Tax
March 17, 2023, 4:15 PM

Portugal Court Allows Tax Exemption on Dividends to Spanish Firm

Jan Stojaspal
Jan Stojaspal
Freelance Correspondent

Portugal’s Supreme Administrative Court confirmed a withholding tax exemption on dividends paid to a Spanish tax resident without permanent establishment in Portugal under a recent ruling.

The exemption was challenged by the Representative of the Public Treasury as part of a dispute with a Spanish entity—only identified as A… SA—seeking the annulment of a 684,855 euro ($728,000) tax charge on a 2016 dividend distribution. The representative acts on behalf of Portugal’s tax administration.

The dividend distribution came from a Portuguese company partially owned by A… SA, an entity which doesn’t have headquarters, effective management, or permanent establishment in Portugal.

The ...