Singapore–Barbados DTA Comes Into Effect
SINGAPORE – The newest of Singapore’s now 75 double taxation agreements (DTA), signed between the city-state and the island nation of Barbados, went into effect on Friday last week. The agreement is expected to boost cross-border trade and investment between Singapore and Barbados by clarifying both parties’ taxation rights so as to avoid double taxation.
The DTA provisions extend to the income tax in Singapore and the income tax, the corporation tax and the petroleum winning operations tax in Barbados.
Under the agreement, dividends will receive a zero withholding tax rate at source, while interest is to be taxed at a maximum rate of 12 percent and royalties at 8 percent, under certain conditions.
Notably, the agreement also contains the latest international standards for the exchange of tax information, under which tax authorities are required to provide information even if it is not required information for the authority itself or held by a bank or other financial institution.
“Barbados is a blue chip global financial and offshore center,” says Chris Devonshire-Ellis of Dezan Shira & Associates. “This agreement with Singapore will boost the country’s ability to house serious global businesses who are interested in ASEAN and looking for reduced royalty rates from trademarks, patents and other management licensing agreements.”
The Barbadian government counts Singapore amongst its most important relationships in the Asia-Pacific region. In July, 2013 the two countries signed an open skies deal giving operators unlimited rights to conduct flights between the two points.
A full list of Singapore’s DTAs can be found here.
Asia Briefing Ltd. is a subsidiary of Dezan Shira & Associates. Dezan Shira is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in China, Hong Kong, India, Vietnam, Singapore and the rest of ASEAN. For further information, please email email@example.com or visit www.dezshira.com.
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