DIVIDENDS (a)
Individuals
and Qualifying
Corporations Corporations (b) Interest (c) Royalties
Residence of % % % %
Recipient
Australia 15 15 10 10
Austria 10 10 0 10 (d)
Barbados 15 5 5 5
Belgium 15 10 10 0/5 (e)
Brazil 15 15 15 10/15/25 (f)
Bulgaria 10 10 0 0/5 (e)
Canada 15 10 0 0/10 (g)
China 10 10 10 10
Czechoslovakia 15 5 0 0/5 (e)
Denmark 15 0 0 0
Egypt 10 10 0 25
Faroe Islands 15 0 0 0
France 0 0 10 0
Germany 15 10 0 0/5 (e)
Greece 13 13 10 0/10 (e)
Hungary 15 5 0 0/5 (e)
Iceland 15 0 0 0
India 25 15 15 30
Indonesia 15 10 10 10/15 (h)
Ireland 0 0 0 0
Israel 15 5 25 10
Italy 15 10 15 0/5 (i)
Japan 15 10 10 10
Korea 15 10 10 10
Luxembourg 15 5 0 0/5 (e)
Malaysia 15 5 15 5
Malta 15 5 10 0/10 (e)
Morocco 15 15 10 10
Netherlands 15 0 0 0
New Zealand 15 15 10 10
Norway 15 0 0 0
Philippines 25 15 15 15/25 (j)
Poland 15 5 0 0/10 (e)
Portugal 15 10 15 10
Romania 10 10 10 10
Russia (q) 0 0 0 0
Singapore 15 5 10 10
Spain 15 10 10 5
Sri Lanka 15 15 10 10
Sweden 15 0 0 0
Switzerland 5/10 (k) 5 0 0
Tanzania 20 20 15 20
Thailand 25 15/20 (l) 10/25 (n) 15
Turkey 20 15 15 10
United Kingdom 15 (o) 5 (o) 0 0
United States 15 5 0 0/5 (m)
Yugoslavia (r) 15 5 0 10
Zambia 15 5 15 0/5/15 (p)
(a) It should be noted that under Finland's imputation system for dividends paid for financial years ending on or after 1990, dividends paid (and subject to a withholding tax) are always net of corporate tax. The imputed corporate tax is credited against a resident shareholder's final income tax, but non-resident shareholders are entitled to the imputation credit only if a relevant tax treaty so provides.
(b) Generally, corporations holding at least 25% of the shares qualify.
(c) Generally, no tax is withheld on interest paid to non-residents in Finland. These tax rates apply only in exceptional cases, for example, for permanent loans used instead of a contribution of capital.
(d) The rate is 0% unless more than 50% of the issued capital is held, in which case the rate in the table applies.
(e) The rate is 0% for royalties received for the use of or the right to use copyrights of literary, artistic or scientific work including cinematographic films or tapes for television or radio broadcasting.
(f) Withholding rates equal 10% of the gross amount of royalties resulting from the use of or the right to use cinematographic films, tapes for television or radio broadcasting and copyrights of literary, artistic or scientific work produced by a resident of Brazil or Finland; 25% for trade income from trademarks and 15% for all other royalties.
(g) Copyright royalties for the production or reproduction of a literary, dramatic, musical or artistic work (but not for motion picture films) are exempt from tax.
(h) The rate is 10% for royalties on copyrights of literary, artistic or scientific work, including films and tapes; otherwise the rate is 15%.
(i) The rate is 0% for royalties received for the use of or the right to use copyrights of literary, artistic or scientific work, excluding cinematographic films or films or tapes for television or radio broadcasting.
(j) The rate is 15% for royalties paid by an enterprise registered with and engaged in preferred activities as well as for cinematographic films or tapes for television or broadcasting; and royalties for the use of or the right to use a copyright of literary, artistic or scientific work.
(k) The rate is 5% for corporations.
(l) The rate is 15% for payments made by industrial companies.
(m) Copyright royalties (including motion picture films, etc.) are exempt.
(n) The rate is 10% if the recipient is a financial institution.
(o) For resident shareholders the imputation credit is 72.4% (21/29) of cash dividends distributed in 1990. For 1991, the credit is 66.7% (2/3); for 1992, it is 56.2% (9/16); and for 1993, it is 33.3% (1/3). Under the treaty, a UK resident is entitled to a refund of this credit, less withholding tax at the treaty rate. For a portfolio investor, the credit is 61.9% (13/21) of the tax credit to which an individual resident in Finland would have been entitled had the payment been received in the 1990 tax year. If the dividend is received in 1991 or later, the co-efficient is 5/8 (62.5%). A 15% tax is withheld at source. A UK corporation that alone or together with one or more associated companies controls directly or indirectly 10% or more or the voting power of the company paying the dividend is entitled to one-half of the credit available to a non-resident portfolio investor. A 5% withholding tax is withheld at source.
(p) The following rates are imposed on royalties: 0% for the use of or the right to use copyrights of literary, artistic or scientific work; 5% for the use of or the right to use copyrights of cinematographic films and films and tapes for television or radio broadcasting; 15% for the use of or the right to use patents, trademarks, designs or models, plans, secret formulas or processes, or industrial, commercial or scientific equipment, or for information concerning industrial, commercial or scientific experience.
(q) Finland is honouring this treaty with respect to the Russian Federation and Estonia.
(r) Finland is honouring this treaty with respect to Slovenia.
The content of this article is intended to provide a general information on the subject matter. It is therefore not a substitute for specialist advice.
