I’ve been wondering this for a while, but if I use a nominee shareholder for setting up a company, and it pays a dividend, how do you account for it? Do you just file your personal tax return as having received the dividend?
It’s usually defined in the nominee agreement. The exact operation taken place varies a bit on the jurisdictions involved. In some cases, we use nominee dividends (the nominee just passes the dividend to the UBO, who is taxed normally) and sometimes we use trust-like setups where the nominee receives the dividends under a trust between the nominee and the UBO.
The UBO is usually taxed as any type of dividend, and the nominee is not subject to any dividend.