articles | 02 September 2014

Double Tax Agreement Between Cyprus And Lithuania Now In Force

The double tax agreement between Cyprus and Lithuania, which was signed in June 2013, is now in force and will take effect from 1 January 2015.

Under the agreement there is no withholding tax on dividends paid by a company resident in Lithuania to a company (but not a partnership) resident in Cyprus provided that the recipient is the beneficial owner of at least 10% of the shares in the company paying the dividend.

Otherwise the maximum rate of withholding tax is 5%. There are no withholding taxes in Cyprus on dividends paid to non-residents. Interest paid by a resident of one state to a resident of the other is taxable only in the state of residence of the recipient. The maximum withholding tax on royalties is limited to 5%.

Gains derived by a resident of one contracting state from the alienation of immovable property situated in the other contracting state, or from the disposal of immovable or movable property associated with a permanent establishment situated in the other contracting state, may be taxed in the contracting state in which the immovable property or the permanent establishment is situated. All other gains, including gains on disposal of shares in ‘property-rich’ companies, are taxable only in the country of residence of the disponor.

Lithuania's economy is one of the fastest-growing in the EU and the new agreement should further economic ties between Cyprus and Lithuania.

Source: Mondaq

Cooperation Partners
  • Logo for Cyprus International Businesses Association
  • Logo for Ministry of Energy, Commerce, Industry and Tourism
  • Logo for Love Cyprus Deputy Ministry of Tourism
  • Logo for CYFA Cyprus
  • Logo for Invest Cyprus
  • Logo for Association of Cyprus Banks
  • Logo for Cyprus Shipping Chamber
  • Logo for Cyprus Investment Funds Association
  • Logo for Cyprus Chamber of Commerce and Industry