In accordance with Article 14, paragraph 3 of the Profit Tax Act, the Ministry of Finance has announced an interest rate between related parties for the year 2020 which amounts to 3,42%. In case when profit income taxpayer gives loan to related party – tax non-resident, the above-stated interest rate is the minimum rate which should be calculated on such loans.
This interest rate also applies to loans between related partied – tax residents if one of them is in a more favorable tax position, that is, if one of them:
1. is paying profit tax at rates below the prescribed rate or is exempt from income tax; or
2. is entitled during the tax period to carry forward a tax loss from previous tax periods