Tax treaties and related documents between the UK and Estonia.
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The Double Taxation Convention entered into force on 19 December 1994 and is effective in Estonia from 1 January 1995.
The convention is effective in the UK from:
- 1 April 1995 for Corporation Tax
- 6 April 1995 for Income Tax and Capital Gains Tax
Royalties no longer subject to withholding tax
Paragraph 7 of the Exchange of Notes to the 1994 Double Taxation Agreement (DTA) contains a ‘Most Favoured Nation’ (MFN) provision relating to royalties (Article 12). It gives UK residents access to any lower rates agreed by Estonia in a DTA it later agrees with an OECD member country (that was a member when the UK-Estonia DTA was signed in 1994).
The Estonia-Switzerland DTA, which entered into force on 16 October 2015, provides for resident state taxation only of royalties and so the 1994 MFN provision has been triggered. The effect of this provision is that from 16 October 2015 no source state taxation is permitted under the DTA in respect of royalties.