On 2 April 2014 Russia ratified the double taxation agreement (DTA) signed with Malta. The tax treaty between Malta and Russia was signed on 24 April 2013 and ratified by Malta on 18 June 2013. This DTA provides for lower withholding tax rates on certain payments between the two countries.
The withholding tax in Russia of 10% on dividends distributed by a Russian company to a company in Malta, where the Maltese company holds at least 25% of the shares of the paying company and such holding amounts to at least €100,000 ($135,000). In other cases, the maximum withholding tax rate is 10%. In the case of a dividend paid from Malta to Russia, the Maltese tax on the gross amount of the dividends is not to exceed the tax chargeable on the profits out of which the dividend was paid.
On interest and royalty income withholding tax in Russia is normally levied at source at a rate capped at 5% of the gross amount of the payment.
