In the case of a dividend in specie the liability for the Dividends tax does not fall on the beneficial owner of the dividend, but on the company paying the dividend. In such a case the company must pay the tax on top of the dividend (i.e. not to be a withheld).”
Generally speaking the Dividends Tax is a withholding tax. As such the tax is withheld from dividend payments and paid to the SARS by the company paying the dividend or, where a regulated intermediary is involved, by the latter. The person liable for Dividends Tax remains ultimately responsible to pay the tax should the company or the withholding agent fail to withhold the tax.