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SINGAPORE: Singapore and Uzbekistan have ratified an agreement to eliminate double taxation for business between the two countries.
Under the Agreement for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income (DTA), Singapore tax residents who derive income from Uzbekistan will enjoy withholding tax of five per cent for dividends and interest, and eight per cent for royalties.
Services provided by residents of Singapore within Uzbekistan will be deemed permanent establishments for tax purposes if the activities continue for more than 183 days in a year.
To eliminate double taxation, both countries will allow a tax credit for tax paid by their residents on foreign-sourced income.
The DTA was first signed in July this year and will come into effect on November 28. Its provisions will apply to income derived on or after 1 January 2009. - CNA/vm
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