According to the Dividend Tax Act 1973, a direct tax is levied under the name of dividend tax on those who – directly or by means of certificates – are entitled to the proceeds of shares in public limited companies established in Suriname. The tax is levied on the proceeds of the shares. Proceeds include immediate or indirect distributions of profit, made under any name or form.
When a public limited company pays dividends to its shareholders, it must withhold 25% dividend tax. If the shareholder is another company established in Suriname, withholding may be omitted under the conditions to be set by the Minister of Finance, the so-called participation exemption. To date, these conditions have not been established by the Minister of Finance. It is therefore unclear whether the Minister of Finance will state in his conditions that a request must be made. However, the law stipulates that the company receiving the dividend must have been a shareholder without interruption from the beginning of the year in which the profit distribution takes place. Although the Minister of Finance has not yet established the conditions, the participation exemption is applied in practice.
If the receiving company is established abroad, the distributing public limited company must withhold dividend tax at the rate of 25%. If the shareholder lives or is established in the Netherlands, the rules of the tax treaty between the Netherlands and Suriname apply.
Other withholding taxes?
There is no withholding tax in case of profit transfers from a Surinamese branch to the head office in another country. To calculate the profit of a business, one can subtract all costs (for example, interest, management costs and technical assistance), provided these costs are determined on an arm’s length basis.
Furthermore, Suriname has no withholding tax on royalties, service costs, management costs, overhead costs, interest and rent.