Double Taxation Aggreements

A constructive use of the Cyprus Treaties’ Network has rendered considerable advantages to businesses and individuals who have chosen to establish legal entities in Cyprus. Tax treaties legally supersede local tax legislation and for this reason they are a useful tax-planning tool to protect businesses and individuals against double taxation of income earned in other countries.

Notes:

  1. The main purpose of these treaties is the avoidance of double taxation of income earned in any of these countries. Under these agreements, a credit is usually allowed against the tax levied by the country in which the tax payer resides for taxes levied in the other treaty country, and as a result the tax payer pays no more than the higher of the two rates (a number of the treaties also contain very beneficial "tax-sparing credits").
  2. The EU Parent Subsidiary and the Interest & Royalties Directives can be used to eliminate withholding taxes on payments of dividends, interest and royalties from or to EU Group Companies and the EU Merger Directive to eliminate the tax effects of EU Group reorganizations

DTT Table (Received in Cyprus) updated Jan ’06 - please scroll down

DTT Table (Paid from Cyprus) updated Jan ’06 - please scroll down

The full text of Cyprus’s Tax Treaties can be downloaded here:

Cyprus Tax Treaties
Cyprus - AustriaCyprus - Macedonia
Cyprus - Austria Final ProtocolCyprus - Malta
Cyprus - BelarusCyprus - Mauritius
Cyprus - BelgiumCyprus - Moldova
Cyprus - BulgariaCyprus - Montenegro
Cyprus - Bulgaria Final ProtocolCyprus - People’s Republic of China
Cyprus - CanadaCyprus - Poland
Cyprus - CroatiaCyprus - Romania
Cyprus - CzechoslovakiaCyprus - Russian Federation
Cyprus - DenmarkCyprus - Serbia
Cyprus - EgyptCyprus - Singapore
Cyprus - FranceCyprus - Slovenia
Cyprus - France Final ProtocolCyprus - South Africa
Cyprus - GermanyCyprus - South Africa Final Protocol
Cyprus - Germany Final ProtocolCyprus - Sweden
Cyprus - GreeceCyprus - Syria
Cyprus - HungaryCyprus - Tajikistan
Cyprus - Hungary Final ProtocolCyprus - Thailand
Cyprus - IndiaCyprus - Thailand Final Protocol
Cyprus - IrelandCyprus - Turkmenistan
Cyprus - ItalyCyprus - UK
Cyprus - Italy Final ProtocolCyprus - USA
Cyprus - KurkystanCyprus - Ukraine
Cyprus - KuwaitCyprus - Uzbekistan
Cyprus - Lebanon 

(updated Jan 2006)

If you have difficulty in downloading the Tax Treaties, please contact us. We will send them to you.

1) Received in Cyprus*

Important Notes:

Full summaries, as well as the full text of the above treaties, are available (on request) from Our Offices.

* Possible use can be made of EU Directives to eliminate or reduce these rates - so rendering the treaty benefits is redundant. Treaties will be used where EU Directives are not applicable.

Received in Cyprus*
CountryDividends (%)Interest (%)Royalties (%)
Austria10 0 0
Belarus5/10/15 (5 if amount invested > 200.000 EURO irrespective of % of votes / 10 if at least 25% of share cap. / otherwise 15)55
Belgium10/15 if <25% of votes10 / 0 if paid to public body 0
Bulgaria5 / 10 if received by a company owning < 25% of share cap.7 / 0 if paid to or guaranteed by a public body10 / does not apply if > 25% of cap. of Cypriot resident owned directly or indirectly by Bulgarian resident paying the royalties and the Cyprus company is subject to a preferential tax rate
Canada1515 / 0 if paid to the Government or for export guarantee10 / 0 on literary, dramatic musical or artistic work with the exception of films used for television programs
China101010
CIS (Armenia, Kyrgyzstan, Moldova, Tajikistan, Uzbekistan, and Ukraine consider themselves bound by the treaty signed with the former USSR. The rates shown are those of the treaty Cyprus / USSR) 0  0  0
Czech Republic1010 / 0 if paid to public body or financial institution5 / 0 on literary, artistic or scientific work including films
Denmark10/15 if < 25% of votes10 / 0 if paid to Government or in connection to the sale on credit of any industrial, commercial or scientific equipment or any merchandise by one enterprise to another or in relation to any form of loan granted by a bank or guaranteed from Government or other State body 0
Egypt151510
France10/15 if < 10% of votes10 / 0 if paid to Government or in connection to the sale on credit of any industrial, commercial or scientific equipment or any merchandise by one enterprise to another or in relation to any form of loan granted by a bank or guaranteed from Government or other State body0/5 on films including films used for television programs
Germany10/15 if <25% of votes10/ 0 if paid to public body or financial institution0 / 5 on films including films used for television programs
Greece25 but local rate is NIL so 0%100 / 5 on film royalties (except films shown on TV)
Hungary5/15 if <25% of votes10/ 0 if paid to public body or financial institution 0
India10/15 if <10% of votes10/ 0 if paid to public body or financial institution15 / 10 on payment of technical fees, management fees and consultancy fees
Ireland0 / 5 on film royalties (except films shown on TV)  0  0
Italy1510 0
Kuwait1010/ 0 if paid to public body or financial institution5 / 0 on literary, artistic or scientific work including films
Lebanon55 / 0 if paid to public body 0
Malta0 The treaty provides that the tax on gross dividends shall not exceed that chargeable on the profits out of which the dividend is paid10/ 0 if paid to public body or financial institution10
Mauritius  0  0  0
Norway5 / 0 if >50% of votes  0  0
Poland1010/ 0 if paid to public body or financial institution5
Romania1010/ 0 if paid to public body or financial institution5 / 0 on literary, artistic or scientific work including films
Russia5 / 10 if received by a company which has invested < $100.000  0  0
Singapore 0 10 / 7 if paid to a Bank or similar financial institution / 0 if to the Government10
Slovakia1010/ 0 if paid to public body or financial institution5 / 0 on literary, artistic or scientific work including films
South Africa  0  0  0
Sweden5/15 if <25% of votes10/ 0 if paid to public body or financial institution 0
Syria0/15 if <25% of votes10/ 0 if paid to public body or financial institution15 / 10 on literary, dramatic, musical, artistic work, films and TV
Thailand1015 / 10 on interest received from financial institutions, on interest paid in connection with industrial, commercial, scientific equipment or the sale or merchandise between two companies5 / 10 on right to use industrial, commercial or scientific experience / 15 on patents, trademarks, designs, models, plans, secret formulas or processes
United kingdom15 but local UK tax provides for 0 - so 0%100/5 on films including films used for television programs
United States of America15 / 5 if more than 10% of votes10 / 0 if paid to the Government or a bank or a fin. Inst. Or in respect to debt obligations arising in connection with sale of property or the provision of services 0
Yugoslavia101010

2) Paid from Cyprus

Full summaries, as well as the full text of the above treaties, are available (on request) from Our Offices.

* Important Notes:

* Low or no withholding taxes on outgoing dividends, interest and royalties (no withholding tax on dividends and interest – therefore there is no columns included below - no withholding tax on royalty payments for use of the rights outside Cyprus, 10% if the rights will be used in Cyprus (subject to DTT & EU Directives) and 5% on films (subject to DTT & EU Directives).

* If the rates of Cyprus tax are lower than those provided by the relevant treaty, then the lower rates are applicable in favor of the taxpayer.

* Possible use can be made of EU Directives to eliminate or reduce these rates - so rendering the treaty benefits is redundant. Treaties will be used where EU Directives are not applicable No tax is withheld when the royalty is paid for use outside Cyprus.

Paid from Cyprus
CountryRoyalties*(%)
Austria 0
Belarus5
Belgium 0
Bulgaria10
Canada10 / 0 on literary, dramatic musical or artistic work with the exception of films used for television programs
China10
CIS (Armenia, Kyrgyzstan, Moldova, Tajikistan, Uzbekistan, and Ukraine consider themselves bound by the treaty signed with the former USSR. The rates shown are those of the treaty Cyprus / USSR) 0
Czech Republic5 / 0 on literary, artistic or scientific work including films
Denmark 0
Egypt10
France0 /5 on films including films used for television programs
Germany0 /5 on films including films used for television programs
Greece0 /5 on film royalties (except films shown on TV)
India15 / 10 on payment of technical fees, management fees and consultancy fees
Ireland0 /5 on film royalties (except films shown on TV)
Italy 0
Hungary 0
Kuwait5 / 0 on literary, artistic or scientific work including films
Lebanon 0
Malta10
Mauritius 0
Norway 0
Poland5
Romania5 / 0 on literary, artistic or scientific work including films
Russia 0
Singapore10
Slovakia5 / 0 on literary, artistic or scientific work including films
South Africa 0
Sweden 0
Syria15 / 10 on literary, dramatic, musical, artistic work, films and TV
Thailand5 / 10 on right to use industrial, commercial or scientific experience / 15 on patents, trademarks, designs, models, plans, secret formulas or processes
United Kingdom0/5 on films including films used for television programs
United Sates of America 0
Yugoslavia10
Countries without agreement5/10

* No tax is withheld when the royalty is paid for use outside Cyprus

Full summaries, as well as the full text of the above treaties, are available (on request) from Our Offices.