Tax treaties news

Ukraine

On 18 April 2017, the amending protocol signed by Luxembourg and Ukraine on 30 September 2016 on the Ukraine-Luxembourg double tax treaty entered into force. The treaty and the amending protocol will generally apply as of 1 January 2018.

The following withholding tax rates will apply under the amended treaty:

• Dividends: the treaty provides for a standard withholding tax rate of 15% which can be reduced to 5% if the receiving company owns directly at least 20% of the share capital of the company paying the dividends.
• Interest: the treaty provides for a standard withholding tax rate of 10% which can be reduced to 5% for interest paid in connection with the sale on credit of industrial, commercial or scientific equipment or interest on bank loans.
• Royalties: the treaty provides for a standard withholding tax rate of 10% which can be reduced to 5% on royalties for copyrights on scientific work, patents, trademarks, secret formulas or process information concerning industrial, commercial or scientific experience.

Luxembourg applies the credit and exemption methods for the avoidance of double taxation.

Uzbekistan

On 18 September 2017, Luxembourg and Uzbekistan signed an amending protocol to the Uzbekistan-Luxembourg double tax treaty. The new provision are not yet in force and further details will be provided once an official copy of the text is available. 

Negotiations

Based on recent public information, Luxembourg has started negotiations to sign a double tax treaty on income and capital with Colombia.

Luxembourg and Sri Lanka have expressed their intention to negotiate an update to the existing double tax treaty on income and capital of 31 January 1983.

Luxembourg and Albania have also expressed their intention to negotiate an update to the existing (but not yet in force) double tax treaty on income and capital of 14 January 2009.