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The Cyprus Ministry of Finance has announced that Cyprus has entered
into a double tax agreement with Saudi Arabia for the avoidance of double
taxation (‘DTT’), which aims to prevent tax evasion.
The Cyprus Ministry of Finance has announced that
Cyprus has entered into a double tax agreement with Saudi Arabia for the
avoidance of double taxation (‘DTT’), which aims to prevent tax evasion. The
DTT was signed on January 3, 2018, in Riyadh during an official visit of the
President of Cyprus there and is expected to be ratified and come into force as
from 1 January 2019.
The agreement is based on the OECD Model Convention
for the Avoidance of Double Taxation on Income and on Capital, and provides for
the exchange of financial and other information. This new DTT contains some
modifications and applies to taxes on income as well as on gains from
alienation of movable or immovable property. In the case of Saudi Arabia, the
treaty covers the Zakat and the income tax (including the natural gas
investment tax), whereas, in the case of Cyprus, it covers corporate and
personal income tax, defense tax and capital gains tax.
The Ministry of Finance of Cyprus has further stated
that this DTT is expected to contribute to the developing economic relationship
between the two countries and enhance co-operation in tax matters. Upgrading
and expanding the island's network of double tax agreements is critical to
strengthening Cyprus as an international business centre.