Question

generally what is the effective tax rate on aggregate forgetting cash positions for U.S. shareholders owning at least 10% of foreign subsidiary

Answer 1

The effective tax rate on aggregate foreign cash position for U.S. shareholders owning at least 10% of foreign subsidiary is 15.5%. This is to the extent it is attributable to the shareholder’s aggregate foreign cash position. Otherwise the rate will be 8%.

The US Shareholder’s aggregate foreign cash position is based on the average of – (i) pro rata shares of its cash position (ii) its share of the cash position at the close of each of their last taxable years (iii) its shares of the cash position at the close of each of their next to last taxable years.

Reference:

KPMG – New Tax Law: International Provisions and Observations. Retrieved from https://home.kpmg.com/content/dam/kpmg/us/pdf/2018/04/international-mini-aem-april18-2018.pdf