International tax & remittance

Hi John,

In the international project appraisal, if we have below scenario

“Company A in country X has subsidiary B in Country Y. X has tax rate 30% and Y has tax rate 20%. B has made taxable profit of $100 and has to remit 80% of the net profit to A as dividend. The 2 countries have bilateral tax agreement to offset tax”

Then, my question is as follow: If we have to calculate Free Cash Flow of A, do we have to calculate the additional tax of 10% based on the whole taxable profit of $100 of B or only 80% of this taxable profit? As from A perspective, it only can receive 80% of the net profit as dividend cash flow, then shouldn’t we only consider only 80% of the additional tax 10% when considering A’s free cash flow?

Thank you