The income and capital tax treaty between Greece and Singapore entered into force on 14 March 2022. The treaty, signed 31 May 2019, is the first of its kind between the two countries.

Taxes Covered

The treaty covers Greek income and capital tax on natural persons and income and capital tax on legal persons. It covers Singapore income tax.

Service PE

The treaty includes the provision that a permanent establishment will be deemed constituted when an enterprise furnishes services within a Contracting State through employees or other engaged personnel for the same or connected project for a period or periods aggregating more than 183 days within any 12-month period.

Withholding Tax Rates

• Dividends - 5% if the beneficial owner is a company that directly holds at least 25% of the paying company's capital; otherwise, 10%
• Interest - 7.5%, with an exemption where:
  • the beneficial owner of the interest is a bank; or
  • the interest is paid to the government of a Contracting State or specified institutions
• Royalties - 7.5%

Capital Gains

The following capital gains derived by a resident of one Contracting State may be taxed by the other State:

• Gains from the alienation of immovable property situated in the other State;
• Gains from the alienation of movable property forming part of the business property of a permanent establishment in the other State; and
• Gains from the alienation of shares or comparable interests deriving more than 50% of the value directly or indirectly from immovable property situated in the other State, with an exemption for shares or comparable interests traded on a recognized stock exchange.

Gains from the alienation of other property by a resident of a Contracting State may only be taxed by that State.

Income from Hydrocarbons and Natural Resources

Article 22 (Income from Hydrocarbons and Natural Resources) provides that a permanent establishment will be deemed constituted where an enterprise carries on offshore activities in connection with the exploration or exploitation of the seabed and subsoil and their natural resources situated in a Contracting State, if such activities are carried on for a period exceeding 30 days in the aggregate in any 12-month period. Substantially similar activities carried on by an associated enterprise in a Contracting State are considered in determining if the 30-day threshold is exceeded.

Double Taxation Relief

Both countries apply the credit method for the elimination of double taxation. Singapore also provides a credit for the Greek tax paid on the profits out of which dividends are paid by a Greek company to a company resident in Singapore, provided that the Singapore company directly or indirectly owns at least 10% of the paying company's share capital.

Entitlement to Benefits

Article 25 (Entitlement to Benefits) provides that a benefit under the treaty shall not be granted in respect of an item of income if it is reasonable to conclude, having regard to all relevant facts and circumstances, that obtaining that benefit was one of the principal purposes of any arrangement or transaction that resulted directly or indirectly in that benefit, unless it is established that granting that benefit in these circumstances would be in accordance with the object and purpose of the relevant provisions of the treaty.

Arbitration

Article 26 (Mutual Agreement Procedure) includes the provision that where the competent authorities are unable to resolve a MAP case within two years from the date all required information has been provided, any unresolved issues arising from the case may be submitted to arbitration if the person that presented the case so requests. Unresolved issues may not, however, be submitted to arbitration if a decision on the issues has already been rendered by a court or administrative tribunal of either Contracting State.

Effective Date

The treaty applies from 1 January 2023.