The DTT agreement was adopted by the Serbian Parliament on 1 July 2021 and shall apply not before 1 January 2022.
The DTT provides the following benefits:
Dividends:
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5% withholding tax rate will apply to the gross amount of the dividends if the beneficial owner holds directly at least 25% of the capital of the company
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10% withholding tax rate will apply to the gross amount of the dividends in all other cases.
Dividend taxation will not be applied in case the dividend is to be paid to the government of Republic of Singapore. The government includes the Central Bank (Monetary Authority of Singapore) and its affiliates that directly and indirectly owns statutory bodies and entities in full.
Interest:
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Taxation on interest shall not exceed 10% of the gross amount of the interest.
Interest that arises in Serbia and that will be paid to the resident of Republic of Singapore will be taxed only in Republic of Singapore if the beneficial owners is the government of Republic of Singapore. The government includes the Central Bank (Monetary Authority of Singapore) and its affiliates that directly and indirectly owns statutory bodies and entities in full.
The Contracting States shall notify each other in writing, through the diplomatic channels, that the procedures required by their respective laws have been complied for the correct entry into force of the DTT.
Investors from the Republic of Singapore who intend to exercise the favourable rates from the DTT are obliged to provide the Certificate of Tax Residency issued for the current year.
Impact on investors: The DTT between the Republic of Serbia the and the Republic of Singapore is expected to create a more favourable tax environment for eligible investors.