The Convention for the Elimination of Double Taxation with respect to Taxes on Income and on Capital and the Prevention of Tax Evasion and Avoidance was signed 8th May2017 in Nicosia.
The text has been agreed between the two countries will contribute to further develop the economic relationship and to enhance the co-operation in tax matters between the Republic of Cyprus and the Grand Duchy of Luxembourg, as Luxembourg is one of the few European Jurisdictions that the Republic of Cyprus had no such convention.
The Convention is based on the OECD Model Convention for the Avoidance of Double Taxation on Income and on Capital and incorporates all the minimum standards of the Base Erosion Profit Shifting (BEPS) project, as issued by the OECD /G20 in October 2015, those of BEPS Action 6 (Treaty Abuse) and BEPS Action 14 (Making Dispute Resolution Mechanisms More Effective). Furthermore it includes the exchange of financial and other information in accordance with the relevant Article of the Model Convention.
Upgrading and expanding the network of Double Taxation Conventions, is of high economic and political importance and aims to further strengthen Cyprus as an international business center.