Uzbekistan Dividend Withholding Tax for Non-Residents 2026: 10% or 5%, Treaties and Repatriation

Dividend withholding tax on a non-resident shareholder in Uzbekistan is withheld by the Uzbek company at the moment of payment, and the default rate is 10% (Art. 353 of the Tax Code). A 5% rate applies until 31 December 2028 to foreign companies that are shareholders of a joint-stock company (JSC), but the rule speaks of dividends on shares, not on LLC participation interests, so a foreign participant in an LLC pays 10% by default unless a double tax treaty gives less. The exception is an IT Park resident with exports above 50% of income: dividends to its foreign founders are taxed at the resident rate of 5%. The withholding agent applies a reduced treaty rate only if the recipient's tax residency certificate is presented no later than the payment date. Everything below is as of the publication date, October 2026.

Key points

• The base rate is 10%. Dividends and interest paid to a non-resident without a permanent establishment are taxed at source at 10%; royalties and fees for management and consulting services at 20% (Art. 353 of the Tax Code).
• 5% applies to shares. From 1 April 2022 to 31 December 2028, dividends of foreign companies on shares are taxed at 5%, and dividends of individuals on shares are exempt from personal income tax (Part 27 of Art. 483). The rule says nothing about LLC interests.
• IT Park with exports: 5% on LLC interests too. For non-resident founders of an IT Park resident with exports above 50% of income, dividends are taxed as for residents from 1 February 2025 to 1 January 2040 (Art. 483).
• A treaty works only with a document. Uzbekistan has more than 50 treaties (the State Tax Committee's official table lists 55 countries), and many cut the rate to 5%, but the residency certificate is needed no later than the payment date (Art. 357).
• New from 2026. Tax on dividends to a non-resident that holds at least 25% for at least 365 days is reduced by the tax already withheld on dividends the payer received from other Uzbek companies (Part 3 of Art. 354).
• Deadlines are short. The tax is remitted no later than the day after the payment, and the return is filed by the 20th of the following month (Art. 355).

Dividend withholding tax rates in 2026

The rate depends on who the recipient is, what they own (an LLC interest or JSC shares) and whether there is a document to apply a treaty.

Dividends are paid out of after-tax profit. For a company on the general 15% corporate rate (banks pay 20%; turnover-tax payers and IT Park residents have their own regimes), out of 100 units of profit 15 go to corporate tax and 85 are distributed, and 8.5 is withheld from that amount at a 10% rate or 4.25 at 5%. The combined burden is 23.5% or 19.25%, before any taxes in the recipient's country.

A treaty only caps the rate: if the treaty says 15% and the Tax Code gives 10%, 10% applies (EY points this out in its Doing Business in Uzbekistan 2026 review). The 5% rate on shares is a domestic Tax Code relief: according to EY, it applies regardless of a treaty and needs no residency certificate.

Why 5% may not work for an LLC

Part 27 of Article 483 of the Tax Code ("Temporary tax incentives") sets a 5% rate for dividends of non-resident legal entities on their shares (in force since 1 April 2022; extended to 31 December 2028 by Law ZRU-891 of 28 December 2023). The word "interests" does not appear in the rule, although Article 41 of the Tax Code, where the law needs to cover both JSCs and LLCs, uses the formula "shares (interests)". EY reaches the same conclusion in its 2026 review: formally the rate relates to JSC shares, not to LLC interests.

At the same time, a distribution of LLC profit to a participant in proportion to interests is also a dividend (Art. 41), so the default 10% applies unless a treaty gives less and the company does not fall under the IT Park exception. Capitalisation of profit, that is, an increase of the charter capital out of the company's own equity, is also a dividend under Article 41, so tax is withheld at source in that case too.

The withholding agent is responsible for the rate: if tax has not been withheld or a treaty has been applied unlawfully, the company itself pays the arrears and penalties (Art. 354). Applying 5% to an LLC interest "by analogy" means taking that risk on yourself, so for an LLC the conservative approach is 10% under the Tax Code, or the treaty rate with a proper document.

Exception: IT Park residents with exports above 50%

Under Art. 483 of the Tax Code, dividends that an IT Park resident with exports above 50% of total income pays to non-resident founders and participants (legal entities and individuals) are taxed at the rates for residents, that is, 5%, from 1 February 2025 to 1 January 2040. The rule also covers LLC interests, and no treaty is needed. The export share should be confirmed by a calculation for the relevant year before each payment: if the condition is not met, 10% applies. For the conditions of the status, see the page on IT Park residency and the article how to become an IT Park resident.

The 2026 credit: a stake of 25% and a holding period of 365 days

From 1 January 2026, Article 354 of the Tax Code has a new Part 3 (Law ZRU-1108 of 25 December 2025). It is not a general rate reduction but a credit against double taxation in the chain "foreign parent, Uzbek holding, Uzbek operating companies": the tax on dividends to a non-resident is reduced by the tax already paid on dividends that the payer received from other Uzbek legal entities. All of the following conditions must be met at the same time:

• The non-resident holds at least 25% of the charter capital of the paying company.
• The stake has belonged to it continuously for at least 365 calendar days before the payment date.
• That tax has not already been taken into account when calculating the tax on dividends to the non-resident.
• The withholding agent has documents confirming payment of the tax on the dividends received.

Example (illustrative and simplified): a foreign company has owned 100% of an Uzbek holding LLC with two subsidiaries for the second year. The subsidiaries distributed UZS 1 billion to the holding, and 5% was withheld from it, that is, UZS 50 million. The holding pays UZS 950 million to the parent company: tax at the Tax Code rate of 10% would be UZS 95 million, but with the credit it is UZS 45 million. Across the chain, UZS 95 million is paid instead of UZS 145 million.

The rule does not say directly whether indirect ownership of 25% counts (PwC writes of direct or indirect ownership, while the Tax Code speaks only of a stake in the payer's charter capital) or how to calculate the credit when the dividends received are only partly passed on, so the position should be fixed before the payment.

Double tax treaties: rates for key countries

The rates come from the State Tax Committee's official table "Information on the provisions of international treaties" as of the publication date; the threshold is the share of capital that the recipient company actually and, as a rule, directly owns.

The zero in the "0% or" variants applies to interest owned by the government or guaranteed by it. According to EY and PwC, the protocol to the treaty with the Netherlands allows 0% on dividends if the holding is exempt from tax in the Netherlands; the official table shows 5% and 15%, so whether the protocol applies has to be confirmed before the payment.

In practice, an LLC participant from the UAE, Germany, the Netherlands or Korea with a stake below 25% pays 10% under the Tax Code; Russia, China and Turkey do not reduce the rate for an LLC below 10%; Singapore gives 5% with no threshold; and the United Kingdom and France give it from just 10% of capital.

Residency certificate: what and when

The treaty is applied by the agent itself, if the recipient is a resident of the treaty country and has presented a tax residency certificate no later than the payment date (Art. 357). For dividends, interest and royalties, the relief applies only to the beneficial owner of the income, and the agent may ask for confirmation of that status. Article 358 of the Tax Code accepts three kinds of document:

• the original, certified by the competent authority of the foreign state, with consular legalisation or an apostille;
• a notarised copy of such an original;
• a paper copy of an electronic document from the website of the competent authority, without legalisation.

If the document does not state the period of residency, it is valid in the calendar year of issue. The Tax Code does not set an approved form, and issuing times differ from country to country, so request the document while preparing the profit distribution decision, not on the eve of the payment.

Step by step: from the participants' decision to money abroad

• Check whether profit may be distributed. The LLC Law (ZRU-1137, in force from 22 July 2026) prohibits the decision before the charter capital is fully paid and before the actual value of the interest of a withdrawing participant is paid, where there are signs of insolvency, and where net assets are lower than the charter and reserve capital (Art. 27). On the payment date the conditions are checked again: with insolvency or a shortfall of net assets, the payment itself is prohibited.
• Determine the rate for each recipient: form of ownership, country, size of the stake, holding period and the payer's IT Park status.
• Obtain the residency certificate and confirmation of beneficial-owner status before the payment date.
• Adopt the general meeting's decision. LLC profit may be distributed quarterly, every six months or annually, in proportion to interests (Art. 26 of ZRU-1137).
• Calculate the tax in sums at the Central Bank rate on the payment date (Art. 354).
• Submit a currency purchase application to the bank. Under clause 21 of the Foreign Exchange Operations Rules No. 3281, currency for repatriating non-residents' income is bought without restriction, but the bank may request documents on the lawfulness of the operation (clauses 23–24).
• Transfer the dividends net of tax, remit the tax and file the return within the deadlines in the table.

The right to transfer is protected by Article 17 of the Law "On Investments and Investment Activity" (ZRU-598): an investor may transfer income from investments abroad without restriction after paying taxes. The transfer may be restricted in case of the enterprise's insolvency, violation of creditors' rights, offences by an individual investor, or by a court or arbitration decision. For more on working with the bank, see the article on currency control and repatriation of revenue.

Example: one payment, six scenarios

The example is illustrative: an Uzbek company pays UZS 10 billion of dividends to a single foreign owner.

The difference between the first two rows is one document that arrived a day late. The recipient may apply to the tax authority for a refund of the excess within three years of the payment (Arts. 357 and 104 of the Tax Code), with a residency certificate valid on the payment date, but the timing and the result depend on the review, and the money stays in the budget all that time.

Ownership structure: directly, through a holding or through a JSC

It is cheaper to choose the form of ownership before registration than to change it later; for the registration itself, see the step-by-step guide to an LLC with a foreign founder.

A holding in a country with a favourable treaty works only if it is the beneficial owner of the income, with real functions and risks; a conduit company with limited powers is not considered one (Art. 6 of the Tax Code). If the beneficial owner behind it is known and is a resident of a treaty country, the treaty with that country applies; if the beneficial owner is a resident of Uzbekistan, domestic rules apply (Part 9 of Art. 6); if the conduit company is in a country without a treaty, the Tax Code rates apply. Loans, services and licences from the parent company may also be tested for arm's-length pricing under the transfer pricing rules.

Royalties and parent-company services: 20% without a treaty

Royalties and fees for management, technical and consulting services are income of a non-resident from a source in Uzbekistan even if the services are performed from abroad (Art. 351); without a treaty the rate is 20%. For royalties, treaties often give less (0% for the Netherlands, France and Russia, 3–5% for Germany), while for services everything depends on the wording of the contract. Payments with no real licence or work do not save tax: they are taxed higher than dividends and lead to a transfer pricing dispute (Arts. 180–182, Parts 7–10 of Art. 180 as worded from 2026).

What changed in 2025–2026

• 1 February 2025: the relief for non-resident founders of IT Park residents with exports above 50% took effect: dividends at resident rates until 1 January 2040 (Art. 483 of the Tax Code).
• 1 January 2026: the credit under Part 3 of Art. 354 started to apply (ZRU-1108). The 5% withholding on dividends paid to Uzbek companies and their exclusion from the recipient's tax base (Arts. 337, 343) applied earlier; from 2026 the exception for consolidated groups was removed from Art. 343.
• 23 April 2026: a direct rule on the purchase of currency by a foreign investor for repatriating dividends and coupons on securities was added to Rules No. 3281 (Resolution of the Central Bank Board No. 10/9); for LLC participants, the general procedure in clauses 21 and 23 of the Rules applies.
• 22 July 2026: the new LLC Law (ZRU-1137) entered into force, and Law No. 310-II ceased to have effect; the dividend rules were carried over in substance without change.

According to the Ministry of Investment, Industry and Trade, foreign direct investment in 2025 was $38.2 billion (out of $43.1 billion of foreign investment disbursed), which is the base for future dividend payments abroad.

Common mistakes

• The rate is chosen without checking the document and the form of ownership. A late certificate and 5% "by analogy" for an LLC interest are covered above; the risk is borne by the withholding company.
• The export share of an IT Park resident is not checked. At exports of 50% or less, the resident rate does not apply.
• The document covers the wrong period or lacks proper certification. It does not confirm residency on the payment date (Art. 358 of the Tax Code).
• A holding without functions and risks. The treaty with its country does not apply (Art. 6 of the Tax Code).
• Tax remitted later than the day after the payment. Penalties accrue.
• A decision or payment despite a shortfall of net assets, insolvency or unpaid charter capital. This is prohibited by Art. 27 of ZRU-1137.

How Pactum helps

• We prepare a tax opinion on the specific payment: the rate, its basis, and whether a treaty, the 2026 credit and the IT Park relief apply.
• We check the residency certificate and the beneficial-owner status, and prepare the meeting decision as part of corporate support.
• We assemble the bank package for the currency purchase and support refunds of tax withheld in excess and annual payments.
• We model the ownership structure: LLC or JSC, the holding's country, an Uzbek holding, and the risks under Art. 6 of the Tax Code and transfer pricing.

If a payment is planned for the coming quarter, start with a lawyer consultation: 60 minutes, UZS 300,000, credited toward the cost of the service; the price of the opinion and of ongoing support is given after we review your task. For more, see the pages on foreign investment in Uzbekistan and tax compliance.

FAQ

Can an LLC pay dividends to a foreign participant quarterly?

Yes. Under Art. 26 of the LLC Law (ZRU-1137), the decision to distribute net profit may be taken quarterly, every six months or annually. Payment is made by the deadline set in the charter or the decision, but no later than 60 days from the decision, and the restrictions of Art. 27 are checked before each decision.

What if the foreign founder has no residency certificate on the payment date?

The agent withholds tax at the Tax Code rate, by default 10% on an LLC interest. The recipient may later claim a refund of the excess within three years of the payment (Arts. 357 and 104 of the Tax Code) with a residency certificate valid on the payment date, but the timing and the result depend on the tax authority's review. If the document is expected soon, it is wiser to move the payment within the 60-day period.

How are dividends taxed for a foreign individual?

A non-resident individual who is an LLC participant pays 10% by default: the reduced 5% in most treaties is given only to a company that directly owns the threshold stake. The exceptions are treaties with a single rate below 10% (for example, Singapore at 5%) and payments from an IT Park resident with exports above 50% (5%, as for residents). Dividends of individuals on shares are exempt from personal income tax until 31 December 2028 (Part 27 of Art. 483 of the Tax Code).

Is there a double tax treaty with Cyprus or the United States?

The State Tax Committee's register lists no treaties with Cyprus or the United States. The United States treats the 1973 treaty with the USSR as applicable, but it does not reduce tax on dividends, so the Tax Code rates apply: by default 10% on an LLC interest, and 5% for a company that is a JSC shareholder until 31 December 2028.

Will a holding in the UAE give a 5% rate?

The treaty with the UAE gives 5% where actual ownership is at least 25% of capital; otherwise the domestic 10% remains. The rate is applied only if the holding is the beneficial owner with real functions and risks and the residency certificate is presented before the payment; find out in advance how long the UAE takes to issue it.

What dividend rate applies to a foreign founder of an IT Park resident?

If the IT Park resident's exports exceed 50% of total income, dividends to non-resident founders, both companies and individuals, including on LLC interests, are taxed as for residents, at 5%, from 1 February 2025 to 1 January 2040 (Art. 483 of the Tax Code). At exports of 50% or less, the general rule applies: 10% or the treaty rate.

Sources

• Tax Code of the Republic of Uzbekistan (Arts. 6, 41, 104, 180–182, 337, 343, 351–358, 381–382, 483), Russian text
• State Tax Committee: information on the provisions of international treaties
• State Tax Committee: international cooperation
• Agreement between Uzbekistan and the UAE on the avoidance of double taxation, document record
• Foreign Exchange Operations Rules, reg. No. 3281
• Law "On Investments and Investment Activity" ZRU-598
• Law "On Limited Liability Companies" ZRU-1137 of 21 April 2026
• Ministry of Investment, Industry and Trade: results of 2025
• EY: Doing Business in Uzbekistan 2026
• PwC Worldwide Tax Summaries: Uzbekistan, withholding taxes
• PwC Worldwide Tax Summaries: Uzbekistan, significant developments

The acts cited are official texts on lex.uz, which are published in Uzbek and, for many acts, in Russian; quotations from them in this article are our own translations. The information is current as of October 2026.