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| {{isdasnap|Indemnifiable Tax}} | | {{nman|isda|2002|Indemnifiable Tax}} |
| ====Commentary====
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| You may marvel at the triple negative here. Especially since the expression {{isdaprov|Indemnifiable Tax}} is often used in the negative (ie "a tax which is not an Indemnifiable Tax") - and even double negative (ie "{{isdaprov|other than}} a tax which is not an indemnifiable tax") in the body of the {{isdama}}.
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| A need to know version is this:
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| {{Quote|An '''{{isdaprov|Indemnifiable Tax}}''' is any tax other than one that would only arise because of the relationship between the taxing authority and the recipient of the payment.}}
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| Under Section {{isdaprov|2(d)}}, if a party is subject to withholding on any payment, it does not have to gross up the withholding tax. this is unless it is an {{isdaprov|Indemnifiable Tax}}: that is, the tax is imposed by dint of the party's own connection to the jurisdiction levying the tax, unless the tax could be avoided by the reciving party taking any action or making any representaiton (or such a representation turning out not to have been true).
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| The basic rationale is that if the tax arises as a result of the underlier, there's no gross up. But if it is a function of the party, then it is grossed up.
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| ====See Also====
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| See in particular Section {{isdaprov|2(d)}} ({{isdaprov|Deduction or Withholding for Tax}}).
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| {{isdaanatomy}}
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