What tax is withheld on interest and royalties paid abroad?

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Interest 10 per cent, royalties 20 — before the treaty says otherwise. 10% Interest — withheld at the source of payment, the same rate as dividends. 20% Royalties and most other income — the residual rate for income not in the named categories. Treaty Rates fall with a certificate — the payer applies the treaty’s lower rate at source against proof of residence, subject to beneficial ownership. Each pay Withheld per payment — the agent computes tax on every payment, in som at the Central Bank rate on the payment date. A non-resident’s Uzbek-source income is taxed in the payer’s hands: dividends and interest at ten per cent, freight at six, and the residual category — royalties among it — at twenty. The Uzbek company withholds on each payment, converting at the Central Bank rate on the payment date, and pays the tax over as the Code directs. The stated rates are the ceiling in practice: a valid treaty commonly cuts interest and royalty withholding, and the payer applies the reduction at source against a residence certificate delivered by the payment date, with the beneficial-owner rules deciding whose treaty counts. Loans that fund a shareholder’s own company are a favourite structure — priced against these rates, they should be planned with the treaty in hand.

What tax is withheld on interest and royalties paid abroad?

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