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8.2.2. Withholding Taxes

The withholding tax rates levied on income received/derived by non-residents from sources within Cook Islands are as below:

Dividend

Tax is withheld at the rate of 15% on dividends paid by Cook Islands resident entities to non-residents.

Interest

Tax is withheld at the rate of 15% on interest paid by Cook Islands resident entities to non-residents.

Royalty Copyright

Tax is withheld at the rate of 15% on royalties paid to non-residents.

Royalty Patent

Tax is withheld at the rate of 15% on royalties paid to non-residents.

Royalty Trademark

Tax is withheld at the rate of 15% on royalties paid to non-residents.

Service Management

There is no withholding tax on management service fees unless the fees are characterized as general service fees (see Service Technical below).

Service Technical

Tax is withheld at the rate of 15% on fees for services performed in the Cook Islands. The withholding tax does not apply if the services (including professional services) are performed by a person (including a company) and:

  • The person is present in the Cook Islands for a period or periods not exceeding in the aggregate 30 days during the relevant tax year; and
  • The income so derived, while being exempt in the Cook Islands, is chargeable in the country of residence of the recipient to any tax which is substantially similar in nature to the Cook Islands income tax; and
  • The services are performed for or on behalf of a person who is not resident in the Cook Islands.

Others

Rental income received by non-residents is subject to withholding tax at the rate of 15%. Subcontractor service fees in respect of mining operations paid to non-residents are subject to withholding tax at 15%.  

Below is a discussion of domestic withholding tax rules for most of the common cross border payments.

Capital Gains 0.0 %
Dividends 15.0 %
Interest 15.0 %
Royalty Copyright 15.0 %
Royalty Patent 15.0 %
Royalty Trademark 15.0 %
Sales 0.0 %
Service Management 0.0 %
Service Technical 15.0 %

* Rates are current as of 25 September 2022