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Ministry of Finance (MOF)
Double Taxation Agreements

Singapore and Bhutan Sign Avoidance of Double Taxation Agreement

12 May 2026

  1. Singapore and Bhutan signed an Avoidance of Double Taxation Agreement (“DTA”) on 12 May 2026.

  2. The DTA was signed in Singapore by Mr. Jeffrey Siow, Acting Minister for Transport and Senior Minister of State for Finance, Republic of Singapore, and H.E. Lyonpo Lekey Dorji, Minister of Finance, Royal Government of Bhutan.

  3. The DTA clarifies the taxing rights of both countries on income arising from cross-border business activities, and addresses the double taxation of such income. This will lower barriers to cross-border investment and trade and economic flows between both countries. Key terms of the DTA can be found in the Annex.

  4. The full text of the DTA is available on the Inland Revenue Authority of Singapore’s website here. The DTA will enter into force after ratification by both countries.

MINISTRY OF FINANCE
12 May 2026


Annex: Summary of key terms in the Singapore-Bhutan DTA

Article in the DTA

Key terms in the DTA

Article 5, Permanent Establishment

  • Period tests as follows, beyond which residents of a contracting state could trigger a taxable presence in the other contracting state:

  • Period test of 6 months for construction-related activities (12 months for Gelephu Mindfulness City (“GMC”))

  • Period test of 120 days in any 12-month period for the furnishing of services (183 days for GMC)


Article 10, Dividends

  • 0% (companies)

  • 5% (others)

  • Residence-only taxation (only GMC)

Article 11, Interest

  • 5% withholding tax rate

  • Financial Institution exemption

  • Residence-only taxation (only GMC)

Article 12, Royalties

  • 5%

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