Status overview of DTAs and Protocols

The purpose of the agreements between the tax administrations of two countries is to enable the administrations to eliminate double taxation.

The Double Taxation Agreements (DTAs) and Protocols that are already in force, have been divided into two groups to make navigation easier, i.e.-

(i) Africa

(ii) Rest of the world

For a full status on all the DTAs and Protocols, whether they are still under negotiation, already signed, but not ratified in one of the member states, or whether they are in force, refer to the status overview document here.

In April 2021, the Kuwait Protocol was signed, although not yet ratified. To date, there has been no change to its status.

As previously discussed in our alert here, the DTA between SA and Kuwait currently provides for a dividends tax rate of 0%. Countries such as the Netherlands and Sweden, which have concluded DTAs with SA containing a so-called most-favoured nation (“MFN”) clause, have benefited from the 0% dividends tax rate set in the SA-Kuwait DTA.

The question however remains whether SARS will argue that dividends declared after the signature date of 1 April 2021 should have been subject to dividends withholding tax of 5% rather than 0% once the Protocol is ratified.

04/02/2022