Barbados, Slovakia Sign Double Taxation Agreement
Barbados and Slovakia signed a double tax agreement on October 28, 2015, to boost investment and trade prospects.
The DTA allocates taxing rights to the two territories, to ensure that cross-border income is not taxed twice.
It further stipulates that cross-border income from dividends will be subject to a withholding tax rate of 0 percent, if the beneficial owner is a company that holds directly at least 10 percent of the capital of the company paying the dividends; or 5 percent in all other cases.
Withholding tax on interest is capped at 10 percent, and income from royalties will be subject to either a 0 or 5 percent rate, depending on the type of intellectual property that the transfer relates to.
The deal also includes provisions for the exchange of tax information between the two territories’ tax authorities.
With the signing of the deal with Slovakia, Barbados has now signed 37 double taxation agreements, which International Business Minister, Donville Inniss, highlighted is a significant number for a small territory. He said: “In order to make and facilitate companies going global, they need these kinds of arrangements, as it brings a level of certainty to the operation, a lot of protection, and certainly it is a good way of efficient tax planning.”
“We firmly believe that Barbados can continue to be an excellent conduit through which International Business and Financial Services will flow and grow. And, it is treaties and agreements like these that certainly send the right signal to the international arena that we are a jurisdiction of substance and serious business,” he concluded.
