The second chamber of the Brazilian Superior Court of Justice (STJ) recently addressed whether technical service fees paid by a Brazilian entity to a Spanish tax resident are subject to taxation in Spain (where the service provider is resident) or to withholding tax (WHT) in Brazil under the Double Taxation Treaty (DTT) between Brazil and Spain.
Historically, Brazilian tax authorities have imposed WHT on payments related to the provision of technical services by foreign entities, even when there …