Payments to residents
Dividend payments to resident shareholders (corporations or individuals) are subject to 15% WHT.
Payments of royalties to resident individuals or corporations are subject to 15% WHT.
Interest paid to a resident individual or legal entity is subject to 15% WHT.
Professional services provided by an individual are subject to 10% WHT.
Payments on the local acquisition of goods and services are subject to 2% WHT.
Payments to non-residents
Payments of dividends, interest, royalties, and service fees to non-resident corporations are subject to WHT, as follows:
|Payment||WHT rate (%)|
|Services provided in general||20|
|TV and radio programming or subscription||15|
In principle, Nicaragua has not signed any agreement or treaty with any country to avoid double taxation.
Transactions with tax havens
Expenses that are paid by Nicaraguan residents to an individual or entity that is a resident of a tax haven are subject to a 30% WHT. For this purpose, a tax haven may be:
- a foreign territory where the income tax is ‘substantially’ lower than the Nicaraguan income tax
- a foreign country or territory that has been listed, for the corresponding taxable year, as an un-cooperative jurisdiction by the Global Forum on Transparency and Exchange of Information for Tax Purposes, or
- a foreign territory that is listed by the Nicaraguan Public Credit and Finance Ministry.
Note that the Nicaraguan government has not published the list of territories deemed as tax havens.