The Republic of Seychelles
signed in 1993 an important agreement for the avoidance of double taxation
and for the prevention of the fiscal evasion, under specific terms, with Malaysia
. Even though the treaty remained the same, the document has been revised in 2003. Malaysian companies with establishments in Seychelles
are protected by the double tax treaty
signed by the two countries, concerning the taxes on profits which are paid in the country where they are registered. We invite you to talk to our team of company formation agents in Seychelles
and solicit complete information about the double taxation treaty signed with Malaysia
. Also, you can ask for support at the time you wish to register a company in Seychelles
Taxes covered by the DTT signed by Seychelles and Malaysia
Even though Seychelles
is considered a tax haven and an important offshore destination
with a privileged tax regime, the double tax treaties
signed by this country facilitate a lucrative business environment by avoiding the double taxation
and strengthening the economic relations with countries worldwide, including Malaysia. The following provisions are of high importance when it comes to the taxation of profits in a company in Seychelles
• the agreement applies to business tax and the petroleum income tax in Seychelles and in Malaysia;
• a withholding tax of 5% rate is applicable in companies with more than 10% foreign ownership;
• the capital gains of a Malaysian company in Seychelles are taxed only in Seychelles;
• tax credits can represent the necessary option for the avoidance of double taxation in Seychelles and Malaysia.
Let us remind you that our team of consultants is at your disposal with complete information about the taxes you need to pay in Seychelles
. You can also solicit accounting services for your company in Seychelles
and benefit from a wide range of solutions that suit most the financial needs in your firm.
Taxation of companies with activities in transportation
Malaysian companies with establishments in Seychelles and with shipping and air transportation operations are taxed only on the profits generated in Seychelles. The same thing is available for Seychelles companies opened in Malaysia due to the provisions of the double taxation convention signed by both countries.
The meaning of permanent establishment
A factory, a branch
, a place of management, a warehouse, an office, or a workshop are considered permanent establishments as long as they are registered in Seychelles
by foreign investors with businesses in the insular state. Even an installation project or a building site is considered a permanent establishment
The taxes on dividends
According to the double taxation treaty signed by Seychelles and Malaysia
, a 10% tax rate is applicable to dividends registered by companies in Seychelles
. The same is available for interest arising in a contracting state and paid to a resident of the other contracting state which is taxable in that other state, not exceeding 10%. Feel free to ask any questions and solicit assistance in matters of taxation from our team of company formation representatives in Seychelles
Details about the mutual agreement procedure
The same double taxation agreement between Seychelles and Malaysia mentions that if a resident of a contracting state considers that the above-mentioned provisions have not been respected, he/she can present the case to the competent authorities in the home country where the domestic laws are applicable. Such a situation needs to be presented within three years from the date the tax provision did not apply. A mutual agreement procedure is often the solution proposed by the local authorities in order to solve any misunderstandings in terms of taxation as stipulated by the double taxation agreement signed by Seychelles and Malaysia. In most cases, the legal support is highly recommended, especially if a mutual agreement enters the discussion. It is good to know that both contracting states can exchange information through the entitled authorities.
The double tax agreement between Seychelles and Malaysia
is applicable on a long-term, but in major situations, this can be terminated through diplomatic arrangements set by both contracting states.
We kindly invite you to find out more details about the double taxation convention signed by Seychelles and Malaysia
and about the taxes you need to pay in the insular state from our experienced team of company formation representatives in Seychelles
. Feel free to contact us
at any time and ask for complete support and information.