Luxembourg’s Council of State approved a draft law to ratify the income and capital tax treaty with Albania on 24 September 2024, it was originally Signed on 14 January 2009, the treaty allows for a maximum dividend tax rate of 5% for companies holding at least 25% of the payer’s capital, while interest and royalties are taxed at 5%.
Albania eliminates double taxation via the credit method and Luxembourg employs a combination of credit and exemption methods. An accompanying protocol was also signed on 21 October 2020, which updates the treaty to align with OECD standards on information exchange.
This agreement, the first of its kind between the two nations, will take effect once ratification instruments are exchanged, with provisions applying from 1 January of the following year.
