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Kuwait - Key Features

Taxes:Stamp Tax,Value-added Tax,Other Taxes,Enterprise Income Tax,Individual Income Tax

Date of Promulgation:

Date of Implementatio:2015-02-01

Annex:

A. Direct taxation: Companies 

B. Direct taxation: Individuals

C. Indirect taxation: Value added tax (VAT)/Goods and services tax (GST)        D. Other taxes

E. General information

 

 

 

 

 

A. Direct taxation: Companies

 

 

1. Resident companies

 

 

Residence

not defined in the decree

 

 

Tax base

territorial

 

 

Corporate tax rates

15%

 

 

Alternative minimum tax

no

 

 

Capital gains

part of business income

 

 

Loss carry-forward

yes, for 3 years.

 

 

Loss carry-back

no

 

 

Unilateral double taxation relief

no

 

 

2. Non-resident companies

 

 

Corporate tax rates

15%

 

 

Capital gains on sale of shares in resident companies

part of business income;

gains on listed companies are exempt from tax

 

 

Capital gains on sale of immovable property

part of business income

 

 

Withholding tax rates

 

 

Branch profits

no

 

 

Dividends

no (generally);

15% if paid by investment funds, investment companies and banks

 

 

Interest

no

 

 

Royalties

no

 

 

Fees (technical)

no;

5% retention (until a non-objection letter is obtained from tax authorities) if part of payments are made for contractors and subcontractors

 

 

Fees (management)

no

 

 

3. Specific issues

 

 

Participation relief

inbound dividends: exempt

outbound dividends: taxed at 15% if paid by investment funds, investment companies and banks

 

 

Group treatment

no

 

 

Incentives

direct foreign capital investments; free zones;

leasing and investment companies

 

 

Anti-avoidance

 

 

Transfer pricing legislation

no formal legislation; there are, however, deemed profit margins between related parties in certain cases

 

 

Thin capitalization legislation

no

 

 

Controlled foreign company legislation

no

 

 

General anti-avoidance rule (GAAR)

no

 

 

Other anti-avoidance legislation

no

 

 

B. Direct taxation: Individuals

 

 

1. Resident individuals

 

 

Residence

not defined

 

 

Taxable income

no

 

 

Income tax rates

no

 

 

Alternative minimum tax

no

 

 

Capital gains

no

 

 

Unilateral double taxation relief

no

 

 

Social security contributions

contribution of 8% covering old age, disability, sickness and death (applies to Kuwaiti nationals only)

 

 

2. Non-resident individuals

 

 

Income tax rates

no

 

 

Capital gains on sale of shares in resident companies

no

 

 

Capital gains on sale of immovable property

no

 

 

Withholding tax rates

 

 

Employment income

no

 

 

Dividends

no

 

 

Interest

no

 

 

Royalties

no

 

 

Fees (technical)

no

 

 

Fees (directors)

no

 

 

C. Indirect taxation: Value added tax (VAT)/Goods and services tax (GST)

 

 

Taxable events

no

 

 

VAT/GST (standard)

no

 

 

VAT/GST (reduced)

no

 

 

VAT/GST (increased)

no

 

 

Registration/deregistration  threshold

no

 

 

VAT group

no

 

 

D. Other taxes

 

 

Inheritance and gift taxes

no

 

 

Net wealth tax (individual)

no

 

 

Net wealth tax (corporate)

no

 

 

Real estate taxes

no

 

 

Capital duty

no

 

 

Transfer tax

no

 

 

Stamp duty

no

 

Excise duties

no

Other main taxes

no

E. General information

Sources of tax law

Decree 3 of 1955 (as amended)

Main types of business entities

joint stock company (شششش شششششششش);

limited liability company(شششش ششش ششششششش شششششش - ش ش ش);

general partnership (company)(شششش ششششش);

limited partnership company(شششش ششششش ششششش);partnership  company  limited  by  shares(شششش ششششش   ششششششش)

Accounting principles

IFRS

Currency

Kuwaiti dinar (KWD)

Foreign exchange control

no

Official websites

Government: www.mof.gov.kw

 

 

Citation: Kuwait- Key Features IBFD.

 

 

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songf@eshui.net(Information Support)

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