The agreement seeks to eliminate double taxation and prevent fiscal evasion.
The UK issued the Double Taxation Relief and International Tax Enforcement (Peru) Order 2025 on 10 December 2025, confirming the ratification of its income and capital tax treaty with Peru.
The agreement seeks to eliminate double taxation and safeguards against tax evasion, avoidance, and treaty shopping, along with provisions to address treaty abuse, prevent artificial avoidance of permanent establishment status, and improve dispute resolution.
It caps dividend withholding tax at 10%, with a 15% rate for dividends linked to immovable property. Interest is capped at 10%, and royalties at 15%.
The treaty will take effect in Peru from 1 January of the year after it comes into force. In the UK, it will apply to withholding taxes from 1 January of the following year, to corporation tax from 1 April after entry into force, and to income tax and capital gains tax from 6 April after entry into force.
Earlier, Peru approved the 2025 Income Tax Treaty with the UK through Supreme Decree No. 051-2025-RE on 20 November 2025, with the ratification published in the Official Gazette on 21 November 2025.
