New Double Tax Treaties
The list of countries with which Slovakia concluded the double tax treaty was extended by Malaysia, Armenia and United Arab Emirates.
The international double tax treaties are subject to approval (ratification) in accordance with the legal procedures of both contracting states and enter into force within the set deadline following the completion of the respective legal procedures.
The respective provisions of the international double tax treaties however, become effective in case of taxes withheld at source with respect to amounts of income derived on or after the first day of January in the calendar year following the year in which the treaty entered into force.
In respect of taxes levied for the tax period, the provisions of the double tax treaty apply to tax periods beginning on or after the first day of January in the calendar year following the year in which the treaty entered into force.
Given the above the provisions of the double tax treaty concluded between the Slovak Republic and Malaysia apply in case of withholding taxes to income derived by the taxpayer as of 1 January 2017 and in case of taxes levied for tax period the provisions of the treaty apply to periods beginning as of 1 January 2017.
As regards the double tax treaties concluded between Slovakia and Armenia or United Arab Emirates, which already entered into force, the respective provisions apply in case of withholding taxes to income derived by the taxpayer as of 1 January 2018. In case of taxes levied for tax periods the treaties’ provisions would apply to tax period beginning on or after 1 January 2018.
Please see below an overview of withholding tax rates for the respective income.
|Income / % withholding tax||Malaysia||Armenia||United Arab Emirates|
|Dividends||0 % / 5 %||5 % / 10 %||0 %|
|Interest||10 %||10 %||10 %|
|Royalties||10 %||5 %||10 %|