Canadian Tax Information
The tax information on this website is not intended to provide legal and/or tax advice. Shareholders are encouraged to consult a professional advisor as to their particular tax consequences of holding Penn West shares.
Canadian Resident Shareholders
Penn West anticipates that dividends paid for 2011 and subsequent years will be eligible dividends for Canadian federal income tax purposes and therefore subject to the enhanced dividend tax credit. This designation will continue until a notification of change is posted on this website. Penn West does not anticipate any return of capital portion in respect of its dividend payments. The actual taxable amount of dividends paid will be communicated to shareholders via a T5 Supplementary Slip prepared by their broker or other intermediary. Registered shareholders who receive dividend payments from our transfer agent, Canadian Stock Transfer Company (“CST”) will receive a T5 Supplementary Slip directly from CST. Penn West does not prepare or furnish shareholders with T5 Supplementary Slips.
Dividends paid to non-residents of Canada are subject to Canadian withholding tax at a rate of 25%. This rate is generally reduced to 15% for shareholders resident in countries which have a tax treaty with Canada. To be eligible for a reduced withholding rate under a tax treaty, Canada Revenue Agency (“CRA”) now requires certain information be provided by the dividend recipient for any payments made after December 31, 2012.
To facilitate the provision of this information, the CRA has issued 3 new forms:
NR301 – “Declaration of Eligibility for Benefits under a tax treaty for a Non-Resident Taxpayer”
NR302 – “Declaration of Eligibility for Benefits under a tax treaty for a Partnership with Non-Resident Partners”
NR303 – “Declaration of Eligibility for Benefits under a tax treaty for a Hybrid Entity”
The use of these forms is not mandatory and equivalent information may be provided by way of letter or other means. Completed forms should be provided directly to your broker (or other intermediary) to ensure eligibility for the reduced withholding rate under the respective tax treaty. In many cases, brokers have already requested this information from our shareholders. Registered non-resident Penn West shareholders will have received a request to complete the applicable CRA form directly from CST.
These forms are not to be sent to Penn West or filed with the CRA, they should be completed and returned to your broker (or other intermediary). Any questions with respect to withholding tax should be made to your broker (or other intermediary) as they are responsible for withholding and remitting the appropriate amount of tax.