Ukraine has completed ratification procedures for Double Tax Treaty (“Treaty”) between Ireland and Ukraine and Protocol thereto signed on 19 April 2013. On 15 July 2015 the Ukrainian parliament approved the ratification law, subsequently signed by the President and officially published.
Withholding tax (“WHT”) rates under the Treaty are as follows:
- Dividends (5% and 15% WHT). Reduced treaty rate of 5% applies if the recipient of dividends is the company, which holds directly at least 25% of the capital of the company paying the dividends. Otherwise, 15% rate applies.
- Interest (0%, 5% and 10% WHT). 0% WHT applies to loans granted by or to the Government or its agencies. Reduced treaty rate of 5% applies to loans granted by banks or interest paid in connection with sale on credit of the equipment. Otherwise, 10% rate applies.
- Royalties (5% and 10% WHT). Reduced treaty rate of 5% applies to royalty paid for use of copyrights of scientific work, patent, trademark and know-how. Otherwise, 10% rate applies.
The Treaty is subject to ratification in both states before it comes into force. Ireland has also completed its ratification procedures. If each Ireland and Ukraine finalize exchange of diplomatic notifications of ratification by the end of 2015, the treaty will apply from 1 January 2016.
We will update you on the status of the treaty in due course.