Loan interest from Kuwaiti borrowers
Our foreign company lent money to a Kuwaiti company. Is the interest taxed?
The situation
Net interest from loans to Kuwaiti companies is taxed at 15%.
The law
- Amiri Decree No. 3 of 1955 as amended by Law No. 2 of 2008 (Income Tax Law): 15% tax on net profits of foreign corporate bodies doing business in Kuwait; Kuwaiti and GCC owned companies taxed only on their foreign ownership share
What it means for you
Kuwait has no WHT, but the lender may need to register and declare. Treaty relief may reduce tax if claimed in the return. Check the treaty interest article.
What to do
- Register if required.
- Compute net interest.
- Check treaty article.
- Claim relief.
We can do this for youTreaty relief claims in the Kuwait tax return (including India Kuwait DTAA): KWD 800