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Double Tax Treaty Romania – South Africa

Double Tax Treaty Romania – South Africa

If you have decided for business in Romania as a citizen from South Africa, you should consider the provisions of the double tax treaty signed by the two states, and meant to help business persons avoid the double taxation of incomes. Whether you are a Romanian with companies in South Africa or a citizen from South Africa with businesses in Romania, the treaty applies to both types of entrepreneurs. In matters of taxation, we invite you to get in touch with our Romanian accountants and solicit information about the taxes you need to pay in this country.

What are the provisions of Romania – South Africa DTT?

The double taxation agreement between Romania and South Africa refers to the methods by which the taxes are imposed, avoiding the double taxation of the profits of a company. The withholding tax is applicable as follows:

  • • a rate of 15% applies to dividends derived from South African companies in Romania;
  • • the withholding tax rate on interests is set to 15%;
  • • the12% rate is the withholding tax applicable to royalties;
  • • the reduced withholding tax is not applicable to the receipt of royalties, dividend, and interests if they are related to a permanent establishment in Romania or South Africa where the taxpayer lives. 

The credit method stipulated by Romania – South Africa DTT

The deduction of taxes in the state in which the incomes are earned, whether in South Africa or Romania can be made through a partial credit. This refers to the situation in which the tax deduction in the country of residence paid in the country of origin is made to the amount conforming to the tax applicable in the state of residence for the foreign revenues. A total credit is also available when the tax deduction granted in the resident country has been paid in the other contracting state.

We invite you to talk to our accountants in Romania and ask for information about the tax structure in this country and about audits for companies in Romania.

Taxation for individuals in Romania and South Africa

It is good to know that the revenues earned by a citizen, whether from Romania or South Africa are taxed only in the country where the earnings are generated. Wages, salaries, and pensions are among the revenues subject to taxation whether in South Africa or Romania.

Please feel free to contact our accounting firm in Romania for extra details about the double taxation treaty signed by Romania and South Africa