The France-North Macedonia tax treaty: dividends at 15%, interest and royalties without tax.

The France-Macedonia tax treaty caps the tax levied by the state of source at 15 % of the gross amount for dividends. A company holding at least 10 % of the capital is taxed only in its state of residence. Interest and royalties are taxable only in the hands of the beneficial owner, subject to certain exceptions. The treaty covers income and capital.

A 1999 text that replaces that of Yugoslavia

The convention was signed in Paris on February 10, 1999. It entered into force on May 1, 2004, and applies to withholding taxes from January 1, 2005. For both states, it replaces the convention signed on March 28, 1974, with Yugoslavia (BOFiP, BOI-INT-CVB-MKD). The BOFiP (French Official Tax Bulletin) titles its page "Former Yugoslav Republic of Macedonia"; the administrative list (BOI-ANNX-000306) states "North Macedonia." The convention is not included in the list of conventions amended by the MLI (BOI-ANNX-000511).

North Macedonia: Maximum retention limits and key rules

The threshold of 10 %: from 15 % to zero

Paragraph 2 of Article 10 contains two rules. (a) caps the tax at 15 % of the gross dividends. (b) excludes any taxation in the State of source when the beneficial owner is a resident company of the other State that directly or indirectly holds at least 10 % of the capital of the paying company. There is no intermediate threshold.

Dividends of €50,000: a numerical example (fictitious profile)

Situation. A resident of North Macedonia, a natural person, fictitious profile, receives €50,000 gross in dividends from a French company.

Issue. He wants to know the maximum amount retained by France.

Strategy. He applies Article 10 § 2 a), then verifies that he is indeed the beneficial owner.

Result. The ceiling is €7,500 (15 %s of €50,000), leaving a balance of at least €42,500. A company holding at least 10 %s of capital would not be taxed at source: it would retain €50,000 before its own tax liability. This calculation represents the maximum allowed by the treaty, not the actual tax due.

Residence (Article 4) and employees (Article 15)

Article 4 defines as a resident any person subject to taxation by virtue of their domicile, residence, or place of business. For an individual resident in both states: permanent home, vital interests, habitual residence, nationality, and then approval by the authorities.

For employees, Article 15 stipulates a stay that does not exceed a total of 183 days during any period of twelve consecutive months, an employer who is not a resident of the other State and an expense not borne by a permanent establishment.

Eliminate double taxation

Article 24 stipulates that France eliminates double taxation by granting a tax credit against French tax, capped at the amount of the corresponding French tax. Macedonia grants a deduction of tax paid in France, up to the amount of the corresponding portion of Macedonian tax. Article 27 governs the exchange of information.

What the page doesn't say about North Macedonia

Internal Macedonian taxes, their application to the French wealth tax (IFI) (the text refers to the former wealth tax (ISF), the terms of the tax credit, and the amicable settlement procedure are not addressed. The text read makes no mention of inheritances or gifts.