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Tax Treaties

I have received income from the United States where a tax rate of 37 % is applied; how is this possible?

Answer

Your investment is probably a US partnership. These fiscally transparent partnerships do not pay tax on their business profits in the United States, but instead, the participants who invest in the partnership are included in US taxation. For participants from outside the United States, tax is levied by applying withholding tax on the income distributions of the partnership. The rate of this withholding tax is usually 37% and the US taxation right on this income is not restricted by a tax treaty.

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