The income tax treaty between Georgia and Moldova entered into force on 17 April 2018. The treaty, signed 29 November 2017, is the first of its kind between the two countries.
The treaty covers Georgian profit tax and income tax, and covers Moldovan income tax.
The treaty includes the provision that a permanent establishment will be deemed constituted when an enterprise furnishes services through employees or other engaged personnel if the activities continue for the same or connected project within a Contracting State for a period or periods aggregating more than 3 months within any 12-month period.
The following capital gains derived by a resident of one Contracting State may be taxed by the other State:
Gains from the alienation of other property by a resident of a Contracting State may only be taxed by that State.
The beneficial provisions of Articles 10 (Dividends), 11 (Interest), 12 (Royalties), and 21 (Other Income) will not apply if the main purpose or one of the main purposes of any person concerned with the creation or assignment of the shares, debt-claims, or other rights in respect of which the income is paid was to take advantage of those Articles by means of that creation or assignment. The limitation is included in each of the Articles.
Both countries apply the credit method for the elimination of double taxation.
The treaty applies from 1 January 2019.
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