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Worldwide Tax News

Approved Changes (1)

Greece

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Greece Further Extends Deadline for VAT Sales and Acquisitions List Submission

On 16 September 2015, the Greek Public Revenue Authority announced that the deadline for submitting the VAT Sales and Acquisitions List would be extended by 1 month to 30 October 2015, with any amending statements due by 30 November 2015. This follows an August circular that set the deadline at 30 September 2015.

In past years, the list was submitted along with the annual VAT return by the last working day of seventh month following the calendar year. However, Greece abolished the annual VAT return requirement in 2014 for tax years beginning on or after 1 January 2014.

Proposed Changes (2)

Australia

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Australia Publishes Draft Bill to Implement Common Reporting Standard for the Automatic Exchange of Financial Account Information

On 18 September 2015, the Australian Treasury published an exposure draft of the Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill 2015: Common Reporting Standard for public comment. The legislation is for the implementation of the OECD Common Reporting Standard (CRS) for the automatic exchange of financial account information. Australian financial institutions with at least one reportable account during a calendar year will be required to submit a statement for each account to the Commissioner by 31 July of the year following the year to which the information relates. According to the CRS, The term “reportable account” means accounts held by individuals and entities (which includes trusts and foundations), and the standard includes a requirement to look through passive entities to report on the relevant controlling persons.

The reporting requirement will apply for calendar years beginning 1 January 2017, although reporting financial institutions will be allowed to elect a 12-month deferral of the obligation.

Public comments are due by 9 October 2015. Click the following links for the Treasury media release, including instruction for submitting comments, the Explanatory Memorandum, and the full text of the Tax and Superannuation Laws Amendment (2015 Measures No. 6) Bill 2015: Common Reporting Standard.

United States

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Five Permanent Extenders Bills Passed by U.S. House Ways and Means Committee

On September 17 2015, the U.S. House Ways and Means Committee passed five permanent extenders bills. The bills include:

  • H.R. 2510 - which would make permanent the additional 50% depreciation allowance, known as bonus depreciation, for depreciable business property (i.e., qualified property) placed in service after 31 December 2014.
  • H.R. 961 - which would make permanent the subpart F foreign personal holding company income exemption for income that is derived in the active conduct of a banking, financing, or similar business, as a securities dealer, or in the conduct of an insurance business.
  • H.R. 1430 - which would make permanent the tax rule exempting dividends, interest, rents, and royalties received or accrued from certain controlled foreign corporations (CFC) by a related CFC from treatment as foreign holding company income (thus permitting tax deferral of such income).
  • H.R. 2940 - with respect to the tax deduction for the expenses of elementary and secondary school teachers, would: (1) allow an inflation adjustment to the amount of such deduction for taxable years beginning after 2014, (2) allow the deduction of professional development expenses, and (3) make such deduction permanent.
  • H.R. 765 - which would make permanent the 15-year recovery period for qualified leasehold improvement property, qualified restaurant property, and qualified retail improvement property for purposes of the tax deduction for depreciation.

The bills are intended to be included in the final extenders package expected to be negotiated by the House and Senate by the end of the year.

Treaty Changes (4)

Australia-Estonia

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SSA between Australia and Estonia Signed

On 14 September 2015, officials from Australia and Estonia signed a social security agreement. The agreement is the first of its kind between the two countries, and will enter into force on the first day of the third month following the exchange of the ratification instruments.

Bulgaria-Romania

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Bulgaria Approves Tax Treaty with Romania

On 10 September 2015, the Bulgarian National Assembly approved for ratification the pending income and capital tax treaty with Romania. The treaty, signed 24 April 2015, will replace the 1994 income and capital tax treaty between the two countries, which is currently in force.

Additional details will be published once available.

Cyprus-Iran

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Update - Tax Treaty between Cyprus and Iran

The income tax treaty between Cyprus and Iran was signed 4 August 2015. It is the first of its kind between the two countries.

Taxes Covered

The treaty covers Cyprus income tax, corporate income tax, special contribution for the defense of the republic; and capital gains tax. It covers Iran income tax.

Withholding Tax Rates

  • Dividends - 5% if the beneficial owner is a company directly holding at least 25% of the paying company's capital; otherwise 10%
  • Interest - 5%
  • Royalties - 6%

Capital Gains

The following capital gains derived by a resident of one Contracting State may be taxed by the other State:

  • Gains from the alienation of immovable property situated in the other State;
  • Gains from the alienation of movable property forming part of the business property of a permanent establishment in the other State; and
  • Gains from the alienation of shares deriving more than 50% of their value directly from immovable property situated in the other State

Gains from the alienation of other property by a resident of a Contracting State may only be taxed by that State.

Double Taxation Relief

Both countries apply the credit method for the elimination of double taxation.

Entry into Force and Effect

The treaty will enter into force once the ratification instruments are exchanged. In Cyprus, it will apply from 1 January of the year following its entry into force. In Iran, it will apply from the first day of Farvardin following its entry into force (Iranian calendar - typically 21 March).

Gabon-Turkey

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Gabon and Turkey Conclude Tax Treaty Negotiations

According to an announcement from the Turkish Revenue Administration, officials from Turkey and Gabon concluded negotiations with the initialing of an income tax treaty on 3 September 2015. The treaty is the first of its kind between the two countries and must be signed and ratified before entering into force.

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