Knowledge Highlights 6 November 2024
Myanmar requires proof of tax paid prior to remittance of foreign currency abroad
On 25 April 2023, the Myanmar Ministry of Planning and Finance issued standard operating procedures (“SOPs”) for verification that taxes owed have been paid prior to the remittance of foreign currency abroad.
Entrepreneurs, companies, organisations and individuals wishing to remit foreign currency of more than US$10,000 abroad must present evidence that they do not owe taxes. The SOPs took effect on 1 May 2023.
The key points of the SOPs are briefly set out here.
Internal Revenue Department
The SOPs provide that where a foreign currency remittance is intended to pay for interest, licences, trademarks, royalties, copyright, or service fees, the Internal Revenue Department (“IRD”) will issue relevant documents to the taxpayer providing evidence that the withholding tax has been paid or that no tax is due. In addition, the IRD is responsible for answering any questions posed by licensed authorised dealer banks (“AD Banks”) or by persons remitting foreign currency abroad relating to the appropriate tax procedures.
New taxpayers must complete additional verifications prior to the first transfer of foreign currency abroad.
AD Banks
The SOPs set out the documentation to be submitted based on the purpose of the remittance, that is, being to transfer profits or pay for goods or to transfer salary income.
The documents set out in the SOPs must be provided to the remitter’s AD Bank as part of the remittance process.
