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HMRC internal manual

Double Taxation Relief Manual

Libya: Source State withholding taxes

Under Article 11 of the Convention, dividends are taxable only in the state of residence of the beneficial owner of the dividends, unless they are dividends paid by property investment companies. The permitted rate on such dividends is 15%, except where they are paid to a pension scheme, in which case they are, like other dividends, exempt from source state taxation.

Interest and Royalties arising in one of the contracting states and beneficially owned by a resident of the other state are taxable only in the state of residence (Articles 12 and 13).

Under Article 22 of the Convention, income not dealt with in other articles of the Convention, may be taxed in the state in which it arises.

Article 6 of the Convention permits source state taxation of any income but this Article is subject to the other provisions of the Convention, thus the rates for dividends, interest and royalties will be as given above.