Capital gains tax deduction (dividend tax credit). The profits of a stock corporation are initially taxed at source (profits and accordingly dividends are taxed by corporate income). The dividend paid to an investor must be taxed again in most countries under the personal income tax of the shareholder. In order to avoid this double taxation, in many countries the dividend paid out can be recognized as deductible from the tax liability, usually within the framework of a tax-free allowance. – See Profit taxation, Capital income, Capital gains tax paradox, Interest income tax.

The profits of a stock corporation are initially taxed at source (profits and accordingly dividends are taxed by corporate income). The dividend paid to an investor must be taxed again in most countries under the personal income tax of the shareholder. In order to avoid this double taxation, in many countries the dividend paid out can be recognized as deductible from the tax liability, usually within the framework of a tax-free allowance. – See Profit taxation, Capital income, Capital gains tax paradox, Interest income tax.

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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
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