Skatteministeriet v T Danmark and another

European Union – Corporation tax. The general principle of EU law that EU law could not be relied on for abusive or fraudulent ends should be interpreted as meaning that, where there was a fraudulent or abusive practice, the national authorities and courts were to refuse a taxpayer the exemption from withholding tax on profits distributed by a subsidiary to its parent company, provided for in art 5 of Directive (EEC) 90/435, even if there were no domestic or agreement-based provisions providing for such a refusal. The Court of Justice of the European Union so held in a preliminary ruling in proceedings concerning the obligation imposed on the respondent companies to pay withholding tax by reason of the payment by them of dividends to non-resident companies regarded by the Danish tax authority as not being the beneficial owners of those dividends and, accordingly, as incapable of being entitled to the exemption from withholding tax provided for by that directive.

Category: