New Singapore-France tax treaty enters into force

A revised tax treaty between Singapore and France entered into force on June 1, the Inland Revenue Authority of Singapore has announced.

The new treaty, signed January 15, 2015, lowers withholding tax rate applicable to dividends to 5 percent if the recipient is a company that owns directly or indirectly at least 10 percent of the share capital of the company paying the dividends. In other cases, a withholding tax rate of 15 percent applies. There is currently no withholding tax on dividends in Singapore, so this provision currently applies only to dividends paid in France.

The treaty also provides for 10 percent withholding tax on interest and for zero withholding on royalties.

The new treaty also introduces an antiabuse rule that denies tax treaty benefits where the “main purpose” of a transaction is to secure treaty benefits contrary to the purposes of the treaty.

See:

• Treaty

Related MNE Tax articles:

• Singapore and France sign tax treaty providing for reduced dividend withholding tax