Like many other countries, Belgium has signed a series of double taxation treaties that allow individuals to avoid double taxation of their income and exempt foreign companies from corporate double taxation. Given that the main purpose of the participation exemption is to avoid “double taxation”, does the crucial question arise as to whether a local tax holiday from which the African subsidiary could benefit involves a piori that is subject to a dividend or a capital gain on the shares in both directions of corporate tax in the amount of 33.99%? Indeed, as indicated above, the exemption from participation depends on the condition sine qua non that the foreign subsidiary is subject to a `normal income tax`. The Belgian double taxation conventions (ASD) have been published on income and capital, in accordance with the Model Convention of the Organisation for the Economy, Co-operation and Development (OECD). Interest received in a Contracting State and paid to a person resident in the other Contracting State may be taxed in that other State. However, such interest may also be taxed in the Contracting State in which it is earned and in accordance with the laws of that State, but if the beneficial owner of the interest is a resident of the other Contracting State, the tax so charged shall not exceed 10% of the gross amount of interest; while interest received in the Democratic Republic of the Congo is subject to a withholding tax of 20%, which is twice as high without DBA between the Democratic Republic of the Congo and South Africa. In particular, Belgium has signed double taxation agreements with countries in the Middle East such as Kuwait, Algeria, Morocco, Egypt, Libya, Syria and the United Arab Emirates. This is why it is important to exploit the economic opportunities offered by the double taxation treaties that Belgium has with different countries. In the EU, Belgium has concluded double taxation treaties with the following countries: Austria, Bulgaria, Czech Republic, Cyprus, Germany, Denmark, Estonia, Finland, Greece, France, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, United Kingdom, Slovenia, Slovakia, Sweden and Spain. The double taxation agreement concluded with Singapore also provides for the exemption of dividends from foreign shareholders who have at least 25% of the company`s capital for more than one year. The tax rate is 5% for a company in which at least 10% of the share capital is held by foreign shareholders and 15% for the rest of the companies.
Interest is taxed at 5% and royalties at 3%. A double taxation convention is a convention signed between two countries to avoid international double taxation of the same type of income. A number of agreements seventh, after administrative assistance, for the collection of the fees to which they apply. The Agreement between South Africa and the Democratic Republic of the Congo eliminated double taxation as follows: if income established in the Democratic Republic of the Congo comes from a source outside the Democratic Republic of the Congo, which may be taxed in South Africa in accordance with the provisions of this Agreement, the Democratic Republic of the Congo shall exempt such income from tax. . . .