Clause 12

where such dividend is the first dividend paid in that year of assessment and where the amount of tax deducted under subsection (1) exceeds the aggregate of the balance, if any, on 1st January of that year of assessment and any tax assessed during the period from 1st January of that year of assessment to the day before the date of payment of the dividend; or

where such dividend is the second or subsequent dividend paid in that year of assessment and where the amount of tax deducted under subsection (1) exceeds the aggregate of the balance, if any, after the preceding dividend and any tax assessed during the period from the date of the payment of the preceding dividend to the day before the date of payment of the second or subsequent dividend,a charge equal to the amount of such excess shall be paid to the Comptroller within 14 days from the date of payment of the dividend, and any amount of tax which remains unpaid on that date shall, notwithstanding section 86, be paid immediately to the Comptroller.(4) Where upon the payment of any dividend the aggregate of the balance, if any, after the date of payment of the preceding dividend and any tax assessed during the period from that date to the day before the date of payment of the first-mentioned dividend exceeds the tax deducted under subsection (1) from the first-mentioned dividend, the excess shall be carried forward as a balance to be set off against the tax deducted from any ensuing dividend.(5) Where any tax assessed which has been taken into account for the purposes of subsection (3) is subsequently reduced and as a result a charge or additional charge arises under that subsection, the charge or additional charge shall be paid to the Comptroller within 14 days of the notice of the charge or additional charge.(6) Where no charge under subsection (3) arises but the amount of tax deducted under subsection (1) exceeds the aggregate amount as computed under subsection (3)(a) or (b) less any amount of tax assessed on the company but not paid, a sum equal to such excess shall be paid to the Comptroller immediately on the date of payment of the dividend.(7) On the payment of any dividend, every company shall render to the Comptroller a statement, in such form as the Comptroller may direct, containing such particulars as may be required for the purpose of determining the balance or charge immediately after the payment of the dividend.(8) At the end of each year of assessment, every such company shall render to the Comptroller a statement, in such form as the Comptroller may direct, containing such particulars as may be required for the purpose of determining the balance to be carried forward to the first day of the ensuing year of assessment.(9) Any charge or additional charge paid by a company to the Comptroller shall be used to set off any tax assessed on it subsequent to the charge or additional charge and the amount of such tax to be taken into account for computing the charge or balance under subsection (3) or (4) shall be reduced by the amount of the set-off.(10) If any charge or additional charge referred to in subsection (3) or (5) is not paid to the Comptroller within the period prescribed for the payment of the charge, section 88 shall have effect in relation to the charge or additional charge, and the provisions of this Act relating to the collection and recovery of tax shall apply to the collection and recovery of the charge or additional charge and penalties imposed thereon.(11) Notwithstanding anything in this Act, where tax on any dividend paid in 1986 has been deducted at the rate of 40% —

the amount of such dividend received by a shareholder shall be deemed to have been paid without deduction of tax and to be a dividend of such a gross amount as after deduction of tax at the rate of 33% would be equal to the net amount paid; and a sum equal to the difference between such gross amount and the net amount paid shall be deemed to have been deducted from the dividend as tax; and

the difference between the amount of the tax deducted at 40% from such dividend and the amount deemed to have been so deducted under paragraph (a) shall be added to the balance on the 1st day of the year of assessment 1987 and deemed to be a part thereof.(12) For the purposes of this section —

subject to paragraph (b), where any dividend has been paid without deduction of tax, such dividend or part thereof, from which a company was entitled to deduct tax, shall be deemed to be a dividend of such a gross amount as after deduction of tax at the rate deductible at the date of payment would be equal to the net amount paid; and a sum equal to the difference between such gross amount and the net amount paid shall be deemed to have been deducted from such dividend or part thereof as tax;

where any dividend has been paid and any amount of the charge referred to in subsection (3) or any amount of tax payable referred to in subsection (3) or (6) is not paid within 14 days from the date of payment of that dividend or by 31st December of the year in which the dividend is paid, whichever is the later, the dividend shall be chargeable to tax on the basis of the net amount received by the shareholder;

in relation to any company, the balance on 1st January of the year of assessment 1987 shall be the balance on the last day of the year of assessment 1986 computed in accordance with section 44(3) before the commencement of the Income Tax (Amendment) Act 1987;

in relation to any company, the balance on 1st January of any year of assessment subsequent to the year of assessment 1987 shall be the aggregate of —

the balance carried forward after the payment of the last dividend in the preceding year of assessment as computed in accordance with subsection (4); and

any tax assessed during the period from the date of the payment of that dividend to the end of the preceding year of assessment;

in determining under subsection (3) or (6) the amount of tax assessed and not paid, any payment made to the Comptroller shall be applied first to the payment of any penalties before the payment of tax;

tax assessed excludes —

tax assessed at the rate of 10% or such other concessionary rate as may be prescribed under section 43A, 43C, 43D or 43E; and

tax in respect of any year of assessment prior to the year of assessment 1987;

where any assessment in respect of —

the year of assessment 1987 or subsequent years of assessment was made before 1st January 1987, it shall be deemed to have been made on that date;

the year of assessment 1986 or prior years of assessment was made on or after 1st January 1987, it shall be dealt with in accordance with section 44 before the commencement of the Income Tax (Amendment) Act 1987;

any balance or tax assessed which has been taken into account for the purpose of determining the charge or balance under subsection (3) or (4) upon the payment of any dividend shall be regarded as having been utilized for that purpose notwithstanding that no set-off has been allowed in respect of that dividend under section 46(3).”.