Application
Generally, if a corporation receives dividends from another corporation, it is entitled to a deduction of 70 percent of the dividend it receives. If the corporation receiving the dividend owns 20 percent or more, however, then the amount of the deduction increases to 80 percent. If, on the other hand, the corporation receiving the dividend owns more than 80 percent of the distributing corporation, it is allowed to deduct 100 percent of the dividend it receives.
Note that in order for the deduction to apply, the corporation paying the dividend must also be liable for tax (i.e., it must be subject to the double taxation that the deduction is intended to prevent).
Read more about this topic: Dividends Received Deduction
Famous quotes containing the word application:
“We will not be imposed upon by this vast application of forces. We believe that most things will have to be accomplished still by the application called Industry. We are rather pleased, after all, to consider the small private, but both constant and accumulated, force which stands behind every spade in the field. This it is that makes the valleys shine, and the deserts really bloom.”
—Henry David Thoreau (1817–1862)
“It is known that Whistler when asked how long it took him to paint one of his “nocturnes” answered: “All of my life.” With the same rigor he could have said that all of the centuries that preceded the moment when he painted were necessary. From that correct application of the law of causality it follows that the slightest event presupposes the inconceivable universe and, conversely, that the universe needs even the slightest of events.”
—Jorge Luis Borges (1899–1986)
“I conceive that the leading characteristic of the nineteenth century has been the rapid growth of the scientific spirit, the consequent application of scientific methods of investigation to all the problems with which the human mind is occupied, and the correlative rejection of traditional beliefs which have proved their incompetence to bear such investigation.”
—Thomas Henry Huxley (1825–95)