Withholding tax reduced to 5% for EU and EEA tax residents

The lowered withholding tax rate is in force for private investors EU / EEA tax residents. The law change is effective from 14 November 2022.

Withholding tax for private individuals from EU/EEA countries is reduced from 20% to 5%. In addition, since the law changes are in place, the taxation process is simplified, as investors now have to confirm their tax residence once and for all. No certificates and additional documentation are needed.

Moreover, to benefit from the 5% tax rate (if you are EU/EEA tax resident) you as an existing investor don’t have to make any additional actions on Debitum platform. The new tax rate will be applied automatically from day one of the new law – 14th of November.

Unfortunately, changes in the law will affect all investors from all counties who had submitted tax residence certificates and they will face tax deductions depending on the tax residence country from 0% to 10% withholding tax. See the list with countries and rates here

The positive is that State Tax authorities have told us our investors will be able to claim tax refunds by submitting the tax refund form. During December we will provide the form for download in your Debitum profile and will assist in filling it correctly.

It means on Debitum platform from the 14th of November:

  • all individual investors from EU/EEA have a 5% withholding tax instead of a 20%
  • for Latvian investors tax rate remains as before – 20%
  • the reduced rate doesn’t apply to investors who are not tax residents of EU or EEA countries
  • for investors from other countries, the standard withholding tax rate will be applied – 20%. The rate can be reduced if the investor submits a tax residency certificate. The full list of reduced applicable tax rates and countries please find here (see the list of countries).
  • investors who are tax residents of Lithuania can reduce the tax rate to 0% if they submit a tax residence certificate (more you can find here)
  • the law changes also don’t apply to legal entities, which are not subject to tax withholding and remain at 0%.

The changes in the law have entered into force earlier than planned (in October 2022 it was announced to become in force from January 2023), therefore monthly income payments for our investors for November will be calculated and paid in the upcoming days.

Our IT is working to implement all necessary system updates to comply with new law requirements. This is our priority number one and will be finished as soon as possible.

Please do not hesitate to contact our customer support for any questions.

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