Double Tax Treaty Luxembourg-Qatar: enforcement (11/06/2010)
The required conditions concerning the enforcement of the Double tax agreement between Qatar and Luxembourg have been complied with on the 9th of April 2010. The tax Treaty is then coming into force in accordance with article 29, §1 of the Convention.
The Convention will be available in Luxembourg for:
- Income attributed the or after the 1st of January 2011 for withholding tax
- Income tax and net wealth tax becoming due as from the 1st of January 2011
The Convention between Luxembourg and Qatar provides for:
- Exemption of withholding tax on dividend if the beneficiary is a company which owns 10% of the share capital of the subsidiary
- 5% withholding tax on dividend paid to an individual who hold 10% of the share capital and who had been a resident of a contracting state the year preceding the payment of the dividend for a period of 48 months
- 10% in any other cases
- Exemption of withholding tax on interest payment
- 5% of withholding tax on royalties payment
In Luxembourg, the avoidance of double taxation concerning dividend, royalties and sportive and artist income is ensured via the tax credit method.
Luxembourg's internal law does not levy any withholding tax on interest and royalties. Exemption on withholding tax on dividend may also be granted if the beneficiary is a company residing in Qatar which has acquired the shares in Luxembourg company for an amount of 1.2 million EUR and that it holds such an amount for a period of 12 months.
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