Madeira
Double Tax Treaties
As
part of Portugal, Madeira has access to
the substantial number of tax treaties
entered into by the mother country. Generally
speaking, the treaty benefits are available
to all Madeiran companies. However, Madeiran
companies in the International Business
Centre licensed under the Free
Trade Zone Legislation are able to
remit interest, dividends and royalties
to non-residents without the imposition
of withholding tax, so that treaty benefits
in that instance are not needed.
The
participation exemption available under
the EU Parent/Subsidiary Directive No.
90/435 also overrides treaty benefits:
any company in the EU owning 25% or more
of another company and having done so
for 2 years or since incorporation is
able to receive income from it without
the application of withholding tax. Among
Madeiran companies, only the Mixed
Holding Company is sometimes unable
to take advantage of the Directive (because
many countries consider that it does not
pay enough tax).
See
Withholding
Taxes for details of rates chargeable
for non-Free Trade Zone companies when
there is no treaty.
The
following countries have double-tax treaties
with Portugal (an * indicates that the
treaty is under negotiation or awaiting
ratification):
-
Austria
-
Belgium
- Brazil
-
Bulgaria
-
Canada
- Cape
Verde
- China
- Cuba
-
Czech Republic
- Denmark
- Estonia
-
Finland
-
France
- Germany
- Greece
-
Hungary
-
India
- Ireland
- Iceland
-
Italy
- Latvia*
- Lithuania*
- Luxembourg*
- Macao
- Malta*
- Mauritius*
- Mexico
|
- Morocco
- Mozambique
- Netherlands
-
Norway
- Pakistan
-
Poland
- Romania
-
Russia
-
Singapore*
- Slovakia*
- Slovenia
-
South Africa*
-
South Korea
- Sweden
- Spain
- Switzerland
- Tunisia*
- Ukraine*
-
United Kingdom
- USA
- Venezuela
|
BACK
TO TOP
Madeira
Table of Treaty Rates
This
table lists the percentage rates of withholding
tax on payments made from Treaty countries
to Madeira and vice versa. When two rates
are quoted, the lower one applies to payments
from a company in which the payee has
a 10% participation - this is the usual
level in OECD-model treaties.
| Country |
Interest |
Dividends |
Royalties |
| Rcvd.
in Madeira |
Paid
from Madeira |
Rcvd.
in Madeira |
Paid
from Madeira |
Rcvd.
in Madeira |
Paid
from Madeira |
| Austria |
10 |
10 |
15 |
15 |
5/10 |
5/10 |
| Belgium |
15 |
15 |
15 |
15 |
5 |
5 |
| Brazil |
15 |
15 |
15 |
15 |
10/15 |
10/15 |
| Bulgaria |
10 |
10 |
10/15 |
10 |
10 |
10 |
| Canada |
10 |
10 |
10/15 |
10/15 |
10 |
10 |
| Czech
Rep. |
10 |
10 |
10/15 |
10/15 |
10 |
10 |
| Denmark |
10 |
10 |
10 |
10 |
10 |
10 |
| Estonia |
10 |
10 |
10 |
10 |
10 |
10 |
| Finland |
15 |
15 |
10/15 |
10/15 |
10 |
10 |
| France |
12 |
10/12 |
15 |
15 |
5 |
5 |
| Germany |
15 |
15 |
15 |
15 |
10 |
10 |
| Greece |
15 |
15 |
15 |
15 |
10 |
10 |
| Hungary |
10 |
10 |
15 |
15 |
10 |
10 |
| India |
10 |
10 |
10/15 |
10/15 |
10 |
10 |
| Ireland |
15 |
15 |
15 |
15 |
10 |
10 |
| Italy |
12.5/15 |
15 |
15 |
15 |
12 |
10 |
| Morocco |
12 |
12 |
10/15 |
10/15 |
10 |
10 |
| Mozambique |
10 |
10 |
15 |
15 |
10 |
10 |
| Netherlands |
10 |
10 |
10 |
10 |
10 |
10 |
| Norway |
nil |
15 |
10/15 |
10/15 |
nil |
10 |
| Poland |
10 |
10 |
10/15 |
10/15 |
10 |
10 |
| Russia |
10 |
10 |
10/15 |
10/15 |
10 |
10 |
| South
Korea |
15 |
15 |
10/15 |
10/15 |
10 |
10 |
| Spain |
15 |
15 |
10 |
10/15 |
5 |
5 |
| Sweden |
10 |
10 |
10 |
10 |
10 |
10 |
| Switzerland |
10 |
10 |
10/15 |
10/15 |
nil |
5 |
| United
Kingdom |
10 |
10 |
nil |
10/15 |
5 |
5 |
| USA |
10 |
10 |
15 |
15 |
10 |
10 |
| Venezuela |
10 |
10 |
15 |
10 |
10 |
10/12 |
The
treaties with Brazil and the USA exclude
MIBC companies..
BACK
TO TOP
Madeira
Other International Agreements
Mutual
Assistance Treaties: Portugal has
entered a number of mutual assistance
treaties as such; in addition, Double
Tax Treaties usually provide for co-operation
with foreign investigators, and some
contain exchange of information clauses.
There are also EU Directives which apply.
By
and large these agreements and the directives
cover drug and weapons trafficking,
as well as money laundering, which is
also covered in Portugal's Banking Secrecy
Law.
Fiscal
crime is not covered by Portugal's international
agreements, nor by the Banking Secrecy
Act. The authorities do not normally
co-operate with foreign investigations
into tax evasion.
The
Tax Reform Act 2000. No doubt with
an eye to the general tightening-up
of global standards of protection against
money-laundering, the Tax Reform Act
has changed the rules so that the Portuguese
tax authorities are no longer required
to obtain a Court Order requesting taxpayer's
information from banking, credit and
finance institutions.
There
is still a right of appeal for the taxpayer
in most circumstances, and this is sometimes
suspensive. There are a number of other
safeguards, including compulsory notification
to the tax-payer of any investigative
process. and a requirement to disclose
evidence to the taxpayer. The legislation
also contains a much wider definition
of reportable transactions than previously.
BACK
TO TOP
