Portugal–Netherlands tax treaty in English (official text)
Convention between the Portuguese Republic and the Kingdom of the Netherlands for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital. Article by article, in the authentic English text, with the Portuguese alongside: 270 aligned provisions.
Signature, entry into force and texts
- Signed
- 20 September 1999, Porto (“Oporto” in the English text)
- Approved by
- Resolução da Assembleia da República n.º 62/2000, de 12 de julho (approved 27 April 2000), DR n.º 159/2000, Série I-A, 2000-07-12; ratified by Decreto do Presidente da República n.º 32/2000 (same DR issue). Netherlands: approved by the States General on 29 November 1999 (Kamerstukken 26 867); texts in Tractatenblad 1999, 180.
- In force
- 11 August 2000 (Aviso n.º 177/2000)
- Takes effect
- From 1 January 2001 in both States (Art. 33(2)). Portugal: taxes withheld at source where the taxable event occurs on or after 1 January 2001; other taxes on income arising in fiscal years beginning on or after that date. Netherlands: withholding taxes on income derived on or after 1 January 2001; other taxes for taxable years or periods beginning on or after that date.
- Authentic languages
- Portuguese, Dutch, English; the English text prevails if the Portuguese and Dutch texts are interpreted differently
- English text
- Authentic, reproduced from the Dutch Treaty Series (Tractatenblad 1999, 180)
Treaty rates for dividends, interest and royalties
The maximum tax the State where the income arises may charge when the beneficial owner is resident in the other State. The article reference opens the provision.
| Income | Rate | Condition | Article |
|---|---|---|---|
| Dividends | Directive (generally 0%) | Dividends paid to a company resident in the other State to which the EU Parent-Subsidiary Directive (90/435/EEC as amended, now Directive 2011/96/EU) applies: the 10% limit of Art. 10(2) does not apply and the Directive as implemented domestically governs, generally giving a withholding exemption (Portugal: Art. 14(3) CIRC, at least 10% held for one year; anti-abuse rules apply). Not a treaty rate. | 10(3) |
| Dividends | 10% | All other dividends beneficially owned by a resident of the other State | 10(2) |
| Interest | 0% | Interest whose debtor is the source State, a political or administrative subdivision or local authority, the central bank or institutions performing public services | 11(3)(a) |
| Interest | 0% | Interest paid to the other State, a political or administrative subdivision or local authority, its central bank or any other institution (including a financial institution) agreed by the competent authorities | 11(3)(b) |
| Interest | Directive | Interest paid between associated companies within the scope of the EU Interest and Royalties Directive (2003/49/EC): the Directive, as implemented domestically, applies instead of Article 11 | 11(5)(b) |
| Interest | 10% | All other interest beneficially owned by a resident of the other State | 11(2) |
| Royalties | 0% | Royalties for the use of, or the right to use, containers in international traffic (taxable only in the State of residence of the beneficial owner) | Protocol XIV |
| Royalties | Directive | Royalties within the scope of the EU Interest and Royalties Directive (2003/49/EC): the Directive, as implemented domestically, applies instead of Article 12 | 12(3) |
| Royalties | 10% | All other royalties beneficially owned by a resident of the other State, including equipment rentals and technical assistance connected with the licensed rights, goods or information | 12(2) |
Treaty rates are maxima, and domestic law may be more favourable. Without treaty relief, Portugal withholds 25% IRC on dividends, interest and royalties paid to non-resident companies and, for individuals, 28% IRS on dividends and interest and 25% on royalties and fees (35% for entities in listed low-tax jurisdictions). The Netherlands levies 15% dividend tax; its conditional withholding tax on interest and royalties (2021) and dividends (2024) targets only low-tax and abusive situations. Payments for technical, consultancy and supervisory services are not royalties (Protocol VI): they fall under Article 7 or Article 14, so the source State may tax them only through a permanent establishment, a fixed base or (for individuals) a stay of more than 183 days (Art. 14(1)(b)); technical assistance connected with licensed rights, goods or information remains a royalty (Art. 12(4)). Excess withholding must be reclaimed within three years after the end of the calendar year of withholding (Protocol XII). Protocol II(3)–(4) denies the benefits of Chapter III to residents benefiting from ring-fenced or harmful regimes. The MLI adds no dividend holding period (Art. 8 does not apply), but the principal purpose test of Art. 7(1) MLI applies to all treaty reductions from 2021 (withholding taxes).
To apply a treaty rate at source in Portugal, the recipient gives the Portuguese payer a form certified by its own tax authority before the tax is due (Article 98 CIRC); otherwise the excess tax can be reclaimed afterwards.
Has the MLI changed this treaty?
The Convention is a Covered Tax Agreement for both States: it is No. 49 in Portugal's list (Resolução da Assembleia da República n.º 225/2019; OECD consolidated position) and No. 56 in the Netherlands' list. Matching the two positions gives the following. The preamble is replaced by the anti-abuse wording of Art. 6(1) MLI (Art. 6(3) does not apply). The principal purpose test of Art. 7(1) MLI is added; there is no simplified LOB, and the discretionary relief in Art. 7(4) does not apply. Art. 13(4) MLI (anti-fragmentation) modifies Art. 5(4), with the Art. 15(1) definition of closely related enterprise; Option A of Art. 13 does not apply because Portugal chose no option. Art. 17(1) MLI replaces Art. 9(2) in substantially the same terms. The Netherlands applies Option A of Art. 5 MLI to Art. 24(3). Both States apply Part VI (mandatory binding arbitration), subject to Portugal's reservations (three-year period, scope limits and independent-opinion procedure). The following MLI provisions do not apply: Art. 3 (transparent entities) and Art. 4 (dual-resident entities), reserved by Portugal; Art. 8 (dividend holding period), not notified by Portugal; Art. 9 (immovable-property companies), as there is no existing provision and the Netherlands did not choose Art. 9(4); Art. 10 (third-State PEs), reserved by Portugal; Art. 11 (saving clause), reserved by the Netherlands; Art. 12 (commissionnaire), reserved by both; and Art. 14 (splitting-up of contracts), reserved by Portugal. Art. 16 (MAP) leaves Art. 27 unchanged in substance: Portugal reserved the first sentence of Art. 16(1), and both States notified the existing three-year limit. Neither State has published a synthesised text for this Convention (the Netherlands' MLI overview gives no link for Portugal), so this analysis is based on the OECD consolidated MLI positions of both States.
- From when
- The MLI entered into force for the Netherlands on 1 July 2019 and for Portugal on 1 June 2020. It has effect for this Convention for taxes withheld at source on taxable events on or after 1 January 2021 and for other taxes for taxable periods beginning on or after 1 December 2020 (Art. 35(1) MLI; Netherlands MLI overview of 1 April 2026: Portugal 01-01-2021 / 01-12-2020). Part VI (arbitration) applies to MAP cases presented on or after 1 June 2020, and to earlier cases only if both competent authorities agree (Portugal's reservation under Art. 36(2)).
- Provisions applied
- Art. 5(2) (Option A, chosen by the Netherlands: Art. 24(3) exemption switched to a credit where Portugal exempts or limits its tax)
- Art. 6(1) (preamble)
- Art. 7(1) (principal purpose test)
- Art. 13(4) (anti-fragmentation, Art. 5(4))
- Art. 15(1) (closely related enterprise, for Art. 13(4))
- Art. 17(1) (corresponding adjustments, replaces Art. 9(2))
- Part VI, Arts. 18–26 (mandatory binding arbitration, with Portugal's reservations)
Every article of the treaty
- 6Income from immovable propertyRendimentos dos bens imobiliários
- 7Business profitsLucros das empresas
- 8Shipping and air transportNavegação marítima e aérea
- 9Associated enterprisesEmpresas associadas
- 10DividendsDividendos
- 11InterestJuros
- 12RoyaltiesRoyalties
- 13Capital gainsMais-valias
- 14Independent personal servicesProfissões independentes
- 15Dependent personal servicesProfissões dependentes
- 16Directors' feesPercentagens de membros de conselhos
- 17Artistes and sportspersonsArtistas e desportistas
- 18Pensions, annuities and social security paymentsPensões, rendas e contribuições para a segurança social
- 19Government serviceFunções públicas
- 20Professors and teachersProfessores
- 21StudentsEstudantes
- 22Other incomeOutros rendimentos
- 25Offshore activitiesActividades offshore
- 26Non-discriminationNão discriminação
- 27Mutual agreement procedureProcedimento amigável
- 28Exchange of informationTroca de informações
- 29Assistance in recoveryAssistência na cobrança
- 30Limitation of articles 28 and 29Limitação dos artigos 28.º e 29.º
- 31Members of diplomatic missions and consular postsMembros das missões diplomáticas e dos postos consulares
- 32Territorial extensionExtensão territorial
How this edition is made
The Portuguese text
Reproduced from the official publication and compared line by line with it. Where a protocol replaced or added a provision, the article shows the wording in force and a note names the protocol.
The English text
An authentic text of the Convention, copied from the Dutch Treaty Series (Tractatenblad 1999, 180) and aligned with the Portuguese paragraph by paragraph. Obvious printing errors are corrected only where another authentic text confirms the reading, and each correction is noted.
What it is not
Not tax advice. Whether a treaty rate applies depends on residence, beneficial ownership, anti-abuse rules and the paperwork; domestic law may give a better result.
The English column is an authentic text of the Convention, reproduced from the Dutch Treaty Series (Tractatenblad 1999, 180). The Convention was done in Portuguese, Dutch and English, each text being authentic; the English text prevails if the Portuguese and Dutch texts are interpreted differently. The Portuguese text is reproduced from the official publication. Editorial notes are ours and are not part of the Convention.
Treaty relief between Portugal and the Netherlands, claimed correctly
Treaty rates are not automatic in Portugal: the recipient must give the payer a form certified by its own tax authority before the tax is due, or claim a refund afterwards. We check which article applies, the rate and the paperwork.