Cyprus – Saudi Arabia double tax treaty

On 3rd January 2018 Cyprus signed a tax treaty with Saudi Arabia the provisions of which will come into effect on 1st January following the date the treaty comes into force.

It covers the following taxes:
1. Dividends – There is no withholding tax on dividends if the investing company holds at least 25% of the capital of the company that is paying the dividends. In all other cases the withholding tax is 5%
2. Interest – There is no withholding tax on interest as far as the recipient of the interest is the beneficial owner of the income
3. Royalties – As far as the recipient of the income is the beneficial owner a 5% withholding tax is imposed on royalties for the use or the right to use industrial, commercial or scientific equipment. In all other cases the withholding tax is 8%
4. Capital gains tax – Gains arising from the disposal of a substantial participation (25% and over at any time within the 12 months prior to the disposal) in the capital of a company which is resident of a contracting state may be taxed in that contracting state