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8 March 2012

Protocol amending the Cyprus Poland Double Tax Treaty

On 22nd March 2012 a Protocol was signed between Cyprus and Poland amending the existing Agreement for the avoidance of Double Taxation between the two countries.

The main changes introduced by the Protocol, which will come into effect on 1st January following the year of ratification, are outlined below:

  • Reduction of withholding tax on Dividends from 10% to 0% if the shareholder company owns at least 10% of the share capital of the company distributing the dividends and 5% in all other cases;
  • Reduction of withholding tax on Interest from 10% to 5%;
  • Directors’ fees are now taxable in the State where the director is a resident.
  • Amendments to the rules concerning avoidance of double taxation by elimination of the “tax sparing” provisions of the existing agreement, i.e. tax credits which would have been given by one State for taxes that should have been payable in the other State but were spared by the other State;
  • A new article for the exchange of information is introduced which is based on the article of the OECD Model Convention.

Please contact our offices for more information as well as for any advice you may require.

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