New list of tax havens | KPMG | BE

E-tax flash - New list of tax havens for the purpose of the Dividends Received Deduction

New list of tax havens

As a reminder dividends received from participations in companies that are considered tax havens cannot benefit from DRD.

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As a reminder dividends received from participations in companies that are considered tax havens cannot benefit from the Dividends Received Deduction (DRD).

Article 203 §1 al. 2 BITC considers that a country is a tax haven if:

  • either the nominal rate of the corporate income tax is less than 15% or the effective corporate tax burden is less than 15%. 

For this purpose a list of tax havens is established by royal decree.  

Are not included on this list (but do also not qualify for DRD):  

  • the countries without a corporate income tax system or the countries that do not impose corporate income tax on certain companies

A Royal Decree published on 10 March 2016 now adapts this list (first time since 2005).

The new list is much shorter than the old one and contains the following countries: Abu Dhabi, Ajman, Andorra, Bosnia and Herzegovina, Dubai, Gibraltar, Guernsey, Jersey, Kyrgyzstan, Kuwait, Kosovo, Liechtenstein, Macao, Macedonia, Maldives, Isle of Man, Marshall Islands, Micronesia, Moldova, Monaco, Montenegro, Oman, Uzbekistan, Paraguay, Qatar, Ras al Khaimah, Serbia, Sharjah, East Timor, Turkmenistan, Umm al Quaiwain.*

The tax payer can provide the counterproof that a country is not a tax haven.  According to the report to the King, it seems that the tax administration requests in this case a double counterproof namely that the nominal rate of corporate tax equals 15% or more and that the effective tax rate equals 15% or more.

The Royal Decree is applicable for dividends allowed/attributed as from 1 January 2016. 

As an exception to this rule, for accounting periods ending before 1 April 2016, the old list still can be relied upon.  

 

*The countries that are new on the list are in bold.

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KPMG Tax Advisers  

Bourgetlaan - Av. du Bourget 40B

1130 Brussels 

Tel.: +32 2 708 38 24

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