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V2482-14 23 September 2014 · SG de Fiscalidad Internacional Criterion in force
IRNR · intereses

No retention on interest paid to Belgian residents exempt under treaty or domestic law

A Spanish company asks about the taxation of interest paid to Belgian resident lenders. The DGT clarifies that, under the double taxation treaty, such interest may be exempt, and therefore no retention is required, although a negative declaration must be filed.

The question raised

Taxation of interest.

The DGT's ruling

The Convention between Spain and Belgium allows interest paid to residents in Belgium to be subject to taxation in Spain at a maximum rate of 10 percent. However, the TRLIRNR establishes the exemption of such interest when obtained by residents in another Member State of the European Union without the mediation of a permanent establishment. Therefore, withholding tax is not applicable, although the withholding agent must file a negative declaration.

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