The increase in the dividend withholding tax from 15% to 20% announced by Finance Minister Pravin Gordhan in his 2017-18 budget is deemed to have taken effect from February 22 and will apply to dividends paid on or after that date. However, tax experts from KPMG sought to provide clarity on Thursday. "The pressing question for a number of taxpayers is whether dividends which were declared prior to February 22 2017, but which have not yet been paid to shareholders, will attract dividends withholding tax at the higher rate. The answer to this question rests on the meaning of ‘paid’ in the context of the dividend withholding tax provisions." The KPMG tax experts said in a newsletter that the provisions distinguish between dividends paid by listed and unlisted companies. "In the case of a listed company, a dividend will only be ‘paid’ once actual payment of the dividend occurs. Dividends which have been declared to shareholders but were not settled prior to February 22 2017 will, theref...

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