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Protocol to the Cyprus - Austria Double Tax Treaty Signed
Update: The protocol to the treaty on income and capital between Cyprus and Austria entered into force on 11 January 2013 and will be applicable from 1 January 2014.
The Cypriot Minister of Foreign Affairs and the Austrian Finance Minister signed a Protocol on 22 May 2012 amending the current Convention for the Avoidance of Double Taxation (DTT) between the Republic of Austria and the Republic of Cyprus with respect to taxes on income and capital which was signed in Vienna on 20 March 1990. Taxand Cyprus takes a look at these amendments to the treaty to see whether businesses are likely to benefit from the increased transparency.
The Protocol amends Article 26 of the DTT relating to the Exchange of Information. In accordance with the Protocol, the Contracting states shall exchange such information as is reasonably relevant for the purpose of carrying out the provisions of the DTT between Austria and Cyprus.
The contracting states are not obliged to exchange such information which is not obtainable under the laws of a contracting states; however a contracting state is expected to provide information to the Requesting State even if the supply of this information is not of domestic interest to the contracting state supplying the information given that such information is permitted to be collected by the laws of the respective contracting state.
Once notifications are received by both states that all legal procedures for the entry into force of the Protocol have been completed, the Protocol shall enter into force on the first day of the third month, following the date of receipt of the latter of the notifications referred to in the treaty document.
Taxand Cyprus discusses the details of the DTT protocol
The updated treaty brings into line the present agreement with OECD requirements for greater transparency and prevention of tax avoidance making Cyprus a safe destination for investments. The Protocol is intended to enhance legal certainty for businesses as it clarifies the Cyprus position on exchange of information and will act to the advantage of Austrian companies operating in Cyprus.
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