Ireland Ratifies Double Tax Agreements With Malta And Macedonia

by Jason Gorringe, Tax-News.com, London

05 February 2009

The Irish Revenue has announced the ratification of conventions with Macedonia and Malta for the avoidance of double taxation and fiscal evasion with respect to income tax.

The agreements with Macedonia and Malta, which were signed on April 14, 2008 and November 14, 2008, respectively, came into force following the Irish ratification of the conventions on January 12, 2009 and January 15, 2009, respectively. Both treaties will come into effect on January 1 2010.

In the case of both agreements, the conventions cover taxes on the income of individuals and companies. They will operate by either granting exclusive taxation rights to one or other country, or where the income or gain remains taxable in both, by providing that the country of residence of the taxpayer will relieve double taxation by allowing a credit for the tax paid in the other country.

The convention with Malta comprises of a nil rate of withholding tax on interest payments and reduced rates of withholding taxes on dividends, and royalty payments. The agreement also includes a non-discrimination article, which protects nationals of each country from discriminatory tax provisions in the other, and the exchange of information article, which is necessary to counter tax evasion.

With regards to the Convention with Macedonia the taxes covered by the agreement are: personal income tax and profit tax in Macedonia, and in Ireland, personal income tax, corporation tax and capital gains. As with the agreement with Malta the agreement includes a non-discrimination article, mutual agreement procedure and an agreement for the exchange of information.

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