Ukraine and Japan sign double taxation avoidance agreement
Kyiv • UNN
Ukraine and Japan have signed a double taxation treaty, which provides for the allocation of taxation rights for certain types of income, such as dividends, interest and royalties, received by residents of one country from sources in the other.
Ukraine and Japan have agreed to share taxation rights for certain types of income, in particular, the right of the country of source to tax dividends, interest and royalties is limited.
This is reported by UNN with reference to the press service of the Ministry of Finance of Ukraine.
Details
In Tokyo, during the Japan-Ukraine Conference on Economic Growth and Reconstruction on February 19, 2024, the Minister of Finance of Ukraine Sergii Marchenko signed the Convention between the Government of Ukraine and the Government of Japan for the Elimination of Double Taxation. The Convention is aimed at avoiding double taxation with respect to taxes on income and preventing tax evasion and avoidance.
The Convention with the Protocol for the Avoidance of Double Taxation establishes rules for the allocation between Ukraine and Japan of the rights to tax certain types of income derived by residents of one Contracting State from sources in the other Contracting State.
Thus, the right of the source country to tax is restricted
dividends (5% - for dividends received by a company of a Contracting State that owns at least 25% of the capital of the company of the other Contracting State that pays such dividends);
interest (10% and 5% if the beneficial owner of the interest is a bank, insurance company or securities trader, or a recognized pension fund, or if the interest is paid in respect of debt claims arising from the sale of equipment or goods or the provision of services on credit);
royalties (5%).
In addition, the Convention defines the methods of elimination of double taxation by the Contracting States, establishes arrangements for the exchange of tax information between the tax authorities of Ukraine and Japan and the procedure for mutual agreement carried out by the competent authorities in case a resident of one of the Contracting States believes that as a result of actions of one or both of the Contracting States he is or will be subjected to taxation that does not comply with the provisions of this Convention.
Recall
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