On 15 May 2019 Cyprus and Kazakhstan have concluded and signed their first Double Taxation Avoidance Agreement (DTTA) and was published in the official Gazette on 24 May 2019. On 17 January 2020 Cyprus and Kazakhstan finalised the exchange of written notifications and as a result, the Treaty is now in force and shall have effect on 1st of January 2021.

The treaty is based on the OECD Model Tax Convention.

Dividends

The withholding tax rate on dividends is set at 5%, as long as the recipient is a company which holds directly at least 10% of the capital of the paying company. In any other case the withholding tax rate on dividends is set at 15%.

Interest

The withholding tax rate on interest is set at 10%, as long as the recipient of the interest is the beneficial owner of the income. In cases where the beneficial owner is the Government of the other state or any other authority owned by the Government of the other state, the withholding tax is Nil.

Royalties

The withholding tax rate on royalties is set at 10%, as long as the recipient of the royalties is the beneficial owner of the income.

Capital gains

The general rule is that gains derived by a resident of a contracting state from the alienation of immovable property may be taxed in the state where the property is located.

Gains derived from the alienation of shares in capital of a company which more than 50% of its value derives directly or indirectly from immovable property located in the other contracting state, maybe taxed in that other state, with the exception of any shares that are listed on a recognised stock exchange.