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Protocol to Tax Treaty between Turkey and Ukraine to Enter into Force — Orbitax Tax News & Alerts

The pending protocol to the 1996 income and capital tax treaty between Turkey and Ukraine will enter into force on 30 November 2020. The protocol, signed 9 October 2017, is the first to amend the treaty and includes the following changes:

  • Article 2 (Taxes Covered) is updated in respect of the taxes covered for both countries;
  • Article 3 (General Definitions) is amended to expand (clarify) the provision regarding terms not defined under the treaty;
  • Article 4 (Resident) is updated to include a State and any political subdivision or local authority within the definition of "resident of a Contracting State";
  • Article 8 (International Transport) is amended to include road vehicles in relation to profits from the use, maintenance, or rental of containers in international traffic;
  • The wording of Articles 10 (Dividends), 11 (Interest), and 12 (Royalties) is amended for clarity, including that a beneficial owner of a Contracting State is eligible for the treaty withholding rates and not just a beneficial owner (the rates are not changed);
  • Article 15 (Dependent Personal Services) is amended to correct a typo in the reference to work carried out in connection with a building site, construction, assembly, or installation project (originally referred to the wrong subparagraph of Article 5);
  • Article 26 (Exchange of Information) is replaced to bring it in line with the OECD standards for information exchange; and
  • A new Article 26A (Assistance in the Collection of Taxes) is inserted.

The protocol applies from 1 January 2021.