Nonresident withholding tax in Uzbekistan: rates and treaties

An Uzbek tax agent withholds tax whenever it pays a foreign company Uzbekistan-source income (Article 351, Tax Code) that is not attributable to the company’s permanent establishment. The domestic rates (Article 353, Tax Code) are 0%, 6%, 10%, or 20%; a tax treaty may reduce them.

In brief:

• dividends, interest, and insurance premiums are taxed at 10%, international communications and freight at 6%, two specified financial income categories at 0%, and other income at 20% (Article 353, Tax Code);
• a company or other tax agent files the return by the 20th of the following month and normally pays the tax the next day (Article 355, Tax Code) after payment to the nonresident;
• a lower treaty rate or exemption applies if the residence certificate is received by the payment date (Article 357, Tax Code);
• before paying, classify the income, check whether it is attributable to a permanent establishment, and establish the recipient’s entitlement to treaty relief.

Updated: 05 September 2026

Taxable income and tax agents

Which nonresident and income are subject to withholding

This article concerns foreign legal entities. A legal entity that is not an Uzbek tax resident is a nonresident (Article 33, Tax Code), and a nonresident receiving Uzbekistan-source income is a corporate income taxpayer (Article 294, Tax Code).

Withholding applies when all three conditions are met:

1. the recipient is a foreign legal entity or a foreign structure without legal personality;
2. the payment is Uzbekistan-source income;
3. the income is not attributable to the recipient’s permanent establishment in Uzbekistan.

If the income is attributable to a permanent establishment, a different procedure applies: the nonresident calculates corporate income tax on profits, taking income and deductions into account. This article covers only the tax withheld by the payer of income.

This article does not calculate the taxable profit of a permanent establishment. The article on a permanent establishment explains when a foreign company’s activities create a taxable presence and how it is registered. It is relevant when the nonresident’s personnel work in Uzbekistan or several contracts form a single project.

Income subject to nonresident withholding tax

The list is broad. It covers dividends, royalties, specified services, property transactions, and non-cash benefits. The list of income (Article 351, Tax Code) includes:

A pure purchase of goods in Uzbekistan or an import does not create such income if Article 351’s conditions are met: the goods are not supplied from storage in Uzbekistan and are not sold through the nonresident’s permanent establishment. Services performed outside Uzbekistan are also excluded unless they fall within a category expressly listed in the article.

If one contract covers services both inside and outside Uzbekistan, the price must be reasonably allocated to each type and supported by accounting records certified by the nonresident. Without an allocation, the entire payment is taxed. The cost of related installation, commissioning, or training services cannot be hidden in the aggregate equipment price either: if the contract does not price them separately, their market value is used.

Who withholds the tax and when

A tax agent is a person whom the Tax Code requires to calculate, withhold, and remit tax. Tax agents include legal entities and sole proprietors (Article 352, Tax Code), permanent establishments and representative offices of nonresidents, and purchasers of specified property from a nonresident.

Tax is withheld upon each payment. A payment is not limited to a bank transfer or cash. It includes a transfer of securities, an ownership interest, goods, or other property; accord and satisfaction; set-off of a counterclaim; set-off upon assignment; novation; debt forgiveness; and discharge caused by impossibility of performance or the debtor and creditor becoming the same person.

For a non-cash payment or set-off, the agent remits the calculated tax and reduces the nonresident’s non-cash income by that amount. If the agent pays the tax from its own funds without withholding it from the payment, the withholding and remittance obligation is still treated as discharged, although the payer’s economic cost under the contract increases.

Rates and calculation

Nonresident withholding tax rates

The domestic rate depends on the income (Article 353, Tax Code), not on the foreign company’s country of incorporation. The country becomes relevant at the next stage, when the applicable tax treaty is checked.

Example. An Uzbek company owes a foreign consultant UZS 100,000,000 for technical services performed in Uzbekistan. If no treaty relief applies, the rate is 20%: UZS 100,000,000 × 20% = UZS 20,000,000 of tax. The nonresident receives UZS 80,000,000 and UZS 20,000,000 is paid to the budget. For a foreign-currency payment, the tax is calculated in soums at the Central Bank exchange rate on the payment date.

Dividends have a special reduction. Tax on a dividend paid to a nonresident may be reduced by tax previously paid on dividends received by the Uzbek company if the nonresident holds at least 25% (Article 354, Tax Code), has held it continuously for at least 365 calendar days, the amount has not previously been used, and the agent has proof that the earlier tax was paid.

Determining the tax base and withholding

The tax agent determines the base separately (Article 354, Tax Code) for each payment. For most categories, it is the income paid without deducting the nonresident’s expenses. Acquisition cost may be deducted only where Article 351 or 356 expressly uses a positive difference.

These special bases include:

• a sale of shares, participatory interests, real estate, an enterprise, or investment fund units: sale price less documented acquisition cost;
• a sale of the nonresident’s goods through an intermediary: the amount due to the nonresident less the documented acquisition cost of the goods;
• freight forwarding: the positive difference between the amount received from the customer and the documented payment to the carrier; without primary documents, the entire amount is taxed;
• assignment of a claim: the positive difference calculated under the special Article 351 rules.

Tax is calculated and paid in the national currency at the Central Bank exchange rate on the payment date. Article 356 establishes separate conversion dates for property transactions, so those transactions cannot be calculated using the ordinary service-payment method.

Exemptions, treaties and documents

When withholding does not apply

Tax is not withheld in four situations: the income is attributable to a permanent establishment and the agent holds a tax-authority-certified registration statement; the Tax Code sets a 0% rate; income under a production sharing agreement is exempt by law; or an applicable tax treaty exempts the income and the required evidence is available.

A contract recital about a permanent establishment does not replace evidence. The nonresident must notify the agent that the income is attributable to the establishment, and the agent must hold the certified statement (Article 354, Tax Code). If income from activities meeting the permanent-establishment test was taxed before registration, the withheld tax may be credited after registration (Article 350, Tax Code) if supporting documents are available.

Applying a double tax treaty

A treaty is checked by the recipient’s country of tax residence and the specific category of income. It may preserve the domestic rate, cap that rate, or assign taxing rights exclusively to one state.

To obtain relief at source, the recipient must give the tax agent its residence certificate by the payment date. For dividends, interest, and royalties, the recipient must also be the beneficial owner. This means it can independently dispose of the income (Article 6, Tax Code); an intermediary with limited authority and no independent functions or risks is not treated as the beneficial owner.

For payment through an intermediary, the contract and supporting documents must state the amount due to each beneficial owner, its name, foreign tax number, and government registration number, if available. For services forming one or related projects, the agent must also examine whether a permanent establishment has arisen. If it has, the business-profits exemption (Article 357, Tax Code) for income without a permanent establishment cannot be applied.

This article does not reproduce the rates in every treaty: they vary by country, income category, ownership percentage, and other conditions. The article on double taxation explains how to select a treaty, test entitlement, and eliminate double tax. Consult it before paying dividends, interest, royalties, or service fees.

Documents to obtain from the nonresident

Treaty relief requires an official document confirming the recipient’s tax residence. The Tax Code accepts three forms (Article 358, Tax Code):

1. an original certified by the foreign state’s competent authority and consularly legalized or apostilled;
2. a notarized copy of such an original;
3. a paper copy of an official electronic document published on the competent authority’s website.

Legalization is unnecessary for a document published on the foreign authority’s official website or where a different authentication procedure follows from an international agreement or an arrangement between competent authorities. If the document does not state a residence period, it confirms residence only for the calendar year in which it was issued or posted.

The tax agent’s working file should make the recipient and calculation auditable: the contract and schedules; documents for services or transferred property; the payment date and form; income classification; tax base, rate, and exchange rate; residence and beneficial-ownership evidence; and, for a permanent establishment, the certified registration statement. The agent’s general duty is to keep recipient-by-recipient records and preserve documents required for tax control.

Payment, reporting and property purchases

Tax payment and filing deadlines

The deadline depends on the obligation and the type of tax agent. The filing and payment deadlines (Article 355, Tax Code) are:

The duty to report the inability to withhold and the amount owed follows from the general agent duties (Article 23, Tax Code). That report does not replace a tax return where the filing obligation has already arisen.

Buying property from a nonresident

A purchaser of shares, an ownership interest, real estate, an enterprise as a property complex, or investment fund units may itself become the tax agent. The base is the positive difference (Article 356, Tax Code) between sale price and documented acquisition cost. Without acquisition documents, tax is withheld from the full sale price.

Before registering title, the buyer files a calculation with the tax authority at the company’s registration place, the real estate’s location, the enterprise’s registration place, or the trustee’s registration place, depending on the asset. The filing includes the sale agreement and acquisition-cost documents. Within 10 business days, the tax authority issues a payment notice or a certificate confirming that no tax debt exists.

Tax must be paid before title is registered. After proof of payment is filed, the tax authority issues a certificate within one business day; the registration authority will not register the transfer without it.

A different mechanism applies to shares and investment fund units sold on an exchange or organized over-the-counter securities market. The clearing house is the tax agent, withholds tax during settlement, and gives the seller a statement of the transaction value and tax on request.

Refunds, liability and payment checks

Refund of excess withholding tax

If a treaty granted relief but tax was already withheld, the beneficial owner may seek a refund under Chapter 12 (Article 357, Tax Code). An excess-tax refund claim may be filed within three years (Article 104, Tax Code). If there is no tax debt, the ordinary refund period after filing is 15 days.

A special procedure applies to sales of shares on an exchange or organized over-the-counter market. The seller files an application with the tax authority where the agent is registered, copies of sale- and acquisition-price documents, and the tax agent’s statement (paragraph 8, Regulation No. 2892). A representative also supplies a power of attorney.

If the application is filed within 30 days after the withheld tax reaches the foreign-currency account, the refund may be made in the same currency. If it is filed after 30 days but within the limitation period, the amount is refunded in national currency (paragraph 19, Regulation No. 2892).

Consequences of failure to withhold or pay

If the agent fails to withhold tax, it must pay the unwithheld amount and default interest (Article 346, Tax Code). Default interest accrues for each calendar day after the due date at a daily rate equal to 1/300 of the refinancing rate (Article 110, Tax Code) of the Central Bank, applied to the arrears.

The general rule for underpayment caused by an incorrect calculation or other unlawful act provides for a 20% penalty (Article 224, Tax Code) on the unpaid tax where the conduct does not fall under another special offense. For late filing, the Code of Administrative Liability provides an administrative fine (Article 175) for an officer of 4.400.000 soums and, for a microfirm or small enterprise, 1.320.000 soums. Here one BRV is the base calculation unit.

Pre-payment checklist for the tax agent

Before releasing payment, a tax agent should follow the same control path:

1. confirm that the recipient is a foreign legal entity, not an individual;
2. determine whether the payment is Uzbekistan-source income;
3. check attribution to a permanent establishment and obtain the certified statement;
4. identify the income category, tax base, and domestic rate;
5. check the applicable treaty, tax residence, and beneficial ownership;
6. record the payment date, exchange rate, and withholding calculation;
7. enter the payment and filing dates in the tax calendar;
8. retain the evidence supporting non-withholding, an exemption, or a reduced rate.

Do not confuse this procedure with tax on income paid to a foreign individual. Employees and other individuals are subject to separate rates, tax bases, and filing rules, addressed in the article on personal income and social tax.

Frequently asked questions

What is the withholding tax rate for nonresident income?

Under domestic law, the rate depends on the income: 10% applies to dividends, interest, and insurance premiums; 6% to international communications and freight; 0% to two specified financial categories; and 20% to other income. The treaty with the recipient’s residence country must then be checked because it may provide a lower rate or an exemption.

Is tax withheld from fees for a foreign company’s services?

Yes, if the services are Uzbekistan-source income listed in Article 351 and are not attributable to a permanent establishment. Technical services comprise management, technical, and consulting services. The place of performance matters for other services. If one contract covers work inside and outside Uzbekistan, the price must be reasonably allocated and documented; otherwise, the entire payment is taxed.

Can a residence certificate be obtained after payment?

To apply an exemption or reduced rate immediately, the tax agent must have the residence certificate no later than the payment date. A certificate obtained later does not automatically reverse the original withholding. The beneficial owner may use the excess-tax refund procedure by establishing treaty entitlement and following Chapter 12 of the Tax Code.

Who pays the tax if it was not withheld?

The obligation to the budget remains with the tax agent: it pays the unwithheld amount and related default interest. The Tax Code also treats the obligation as discharged if the agent pays the calculated tax from its own funds without deducting it from the nonresident’s income. This does not remove consequences of late payment or miscalculation, so the rate basis and payment date should be documented before funds are released.

Is tax withheld when buying an ownership interest from a foreign company?

Yes. The buyer may be the tax agent. If documents are available, the tax base is the positive difference between sale price and acquisition cost; without them, tax is calculated on the full sale price. The calculation and supporting documents are filed before the transfer is registered, and tax is paid before completion. Exchange sales of shares and investment fund units follow a special clearing-house procedure.