background image
Note: This Treaty may be impacted by the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS (MLI). MLI impact on Tax Treaties is available with the Orbitax International Tax Research & Compliance Expert.

ARTICLE 23

Elimination of Double Taxation

(1) In Latvia, double taxation shall be eliminated as follows:

  • (a) Where a resident of Latvia derives income or owns capital which, in accordance with this Convention, may be taxed in Slovakia, unless a more favourable treatment is provided in its domestic law, Latvia shall allow:
    • (i) as a deduction from the tax on the income of that resident, an amount equal to the income tax paid thereon in Slovakia;
    • (ii) as a deduction from the tax on the capital of that resident, an amount equal to the capital tax paid thereon in Slovakia.
  • Such deduction in either case shall not, however, exceed that part of the income tax or capital tax in Latvia, as computed before the deduction is given, which is attributable, as the case may be, to the income or the capital which may be taxed in Slovakia.
  • (b) For the purposes of sub-paragraph (a), where a company that is a resident of Latvia receives a dividend from a company that is a resident of Slovakia in which it owns at least 10 per cent of its shares having full voting rights, the tax paid in Slovakia shall include not only the tax paid on the dividend, but also the appropriate portion of the tax paid on the underlying profits of the company out of which the dividend was paid.

(2) In Slovakia, double taxation shall be eliminated as follows:

  • Slovakia, when imposing taxes on its residents, may include in the tax base upon which such taxes are imposed the items of income or capital which according to the provisions of this Convention may also be taxed in Latvia, but shall allow as a deduction from the amount of tax computed on such a base an amount equal to the tax paid in Latvia.

Such deduction shall not, however, exceed that part of the Slovak tax, as computed before the deduction is given, which is attributable to the income or capital which, in accordance with the provisions of this Convention, may be taxed in Latvia.

(3) Where in accordance with any provision of the Convention income derived by a resident of a Contracting State is exempt from tax in that State, such State may nevertheless, in calculating the amount of the tax on the remaining income of such person, take into account the exempted income.