Last updated 2026-06-27

Double Taxation Treaty (DTT)

A Double Taxation Treaty (DTT) is a bilateral agreement between two countries that determines which country may tax cross-border income, and at what rate. For dividends and interest, DTTs typically cap withholding tax at 10–15%, preventing investors from being taxed in full by both the source country and their home country.

As of 2025, the OECD counts over 3,000 bilateral tax treaties in force worldwide. Most DTTs follow the OECD Model Tax Convention, which sets a 15% standard dividend rate for portfolio investors. Some treaties set lower rates for substantial shareholdings (often 5%) or exempt certain pension funds and governments entirely. Without a DTT, the source country applies its domestic rate — which can reach 35% (Switzerland) or 30% (US, Belgium, Sweden).

Source: OECD Model Tax Convention on Income and on Capital (2017)