Statutory rate without a valid treaty claim: 30%.
Rates on investment and other income
Treaty in effect generally from Jan. 1, 2002. Protocols in effect from: none listed. IRS country code SI.
| Income | 1042-S code | Treaty rate | Article |
|---|---|---|---|
| Interest paid by U.S. obligors, general | 01 | 5%gzjj | 11(2) |
| Dividends paid by U.S. corporations, general | 06 | 15%mm | 10(2) |
| Dividends qualifying for the direct dividend rate | 07 | 5%mm | 10(2) |
| Royalties: industrial, commercial or scientific equipment | 10 | n/au | 12(1) |
| Royalties: know-how and other industrial royalties | 10 | 5% | 12(1) |
| Royalties: patents | 10 | 5% | 12(1) |
| Royalties: motion picture and television copyrights | 11 | 5% | 12(1) |
| Royalties: copyrights (including software, unless the treaty says otherwise) | 12 | 5% | 12(1) |
| Pensions and annuities | 15 | 0% (exempt)f | 18(1) |
| U.S. Social Security benefits (applies to 85% of the payment) | 15 | 30% | 18(2) |
"n/a" means the payment type is not covered by the royalty article: equipment leasing is business profits (no withholding without a permanent establishment) or other income. Superscript letters are the IRS's own conditions, listed at the end of this page.
Pay for personal services performed in the United States
Each row is an exemption the treaty gives, with the limits the IRS lists. All conditions in a row must be met; if any is not, the pay is withheld on at 30% (contractors) or under the wage rules (employees). Services performed entirely outside the United States are foreign-source and need no treaty claim.
| Code | Purpose | Maximum presence in U.S. | Required employer or payer | Maximum amount | Article |
|---|---|---|---|---|---|
| 16 | Scholarship or fellowship grant4510 | 5 years | Any U.S. or foreign resident | No limit | 20(1) |
| 17 | Independent personal services7 | No limit | Any contractor | No limit | 14 |
| 18 | Dependent personal services121758 | 183 days | Any foreign resident | No limit | 15 |
| 42 | Public entertainment30 | No limit | Any U.S. or foreign resident | $15,000 p.a. | 17 |
| 19 | Teaching or research440 | 2 years | Any U.S. or foreign resident | No limit | 20(3) |
| 20 | Remittances or allowances10 | 5 years | Any foreign resident | No limit | 20(1) |
| 20 | Compensation during training | 12 mos | Slovenian resident | $8,000 | 20(2) |
| 20 | or: Compensation during training10 | 5 years | Other foreign or U.S. resident | $5,000 p.a. | 20(1) |
| 20 | Compensation while gaining experience2 | 12 mos | Slovenian resident | $8,000 | 20(2) |
How the payee claims these rates
- Individuals claim a reduced rate on interest, dividends, royalties or pensions in Part II of Form W-8BEN: treaty country, article, rate and any conditions. Most claims need a U.S. TIN or a foreign TIN on the form.
- Entities claim in Part III of Form W-8BEN-E, which also asks which limitation-on-benefits test the entity meets (the Slovenia treaty's LOB provision is Article 22).
- Pay for services performed in the United States by an individual is exempted on Form 8233, not the W-8BEN, one form per tax year and per payer.
- The payer reports the payment on Form 1042-S with the income code shown above and chapter 3 exemption code 04 (exempt or reduced withholding under a tax treaty). From 2026 an exemption code is required whenever less than 30% is withheld.
The rate in a table is the most the United States may withhold under the treaty, not an entitlement. The payee has to be a resident of Slovenia under the treaty, the beneficial owner of the income, and (for entities) meet the limitation-on-benefits article, and the payer has to hold a valid certificate before the payment. The IRS tables are a summary: check the article itself when the amount is material.
Questions payers ask
What is the U.S. withholding rate on dividends paid to a resident of Slovenia?
15% on dividends generally and 5% on dividends qualifying for the direct dividend rate, under Article 10(2), if the shareholder documents the claim on a W-8BEN or W-8BEN-E. Without a valid claim the rate is 30%.
What is the U.S. withholding rate on royalties paid to a resident of Slovenia?
5% on copyright and software royalties (income code 12), 5% on patent royalties and 5% on film and television royalties, under Article 12(1).
What is the U.S. withholding rate on interest paid to a resident of Slovenia?
5% under Article 11(2), before considering the Code's own exemptions for portfolio interest and bank deposit interest.
Is a contractor from Slovenia working in the United States exempt from U.S. withholding?
Under Article 14, pay for independent personal services is exempt if the contractor is present in the United States for no more than no limit, subject to the conditions in the article. An individual claims the exemption on Form 8233; without it, withhold 30%.
Do we withhold on a contractor from Slovenia who works only outside the United States?
No. Pay for services performed entirely outside the United States is foreign-source income: no withholding and no Form 1042-S. Keep the contractor's W-8BEN or W-8BEN-E on file.
The IRS notes behind the figures
Notes to the rates (IRS Table 1)
- f Includes alimony.
- g Exemption or reduced rate does not apply to an excess inclusion for a residual interest in a real estate mortgage investment conduit (REMIC).
- u If enterprise earns income from leasing of equipment in the conduct of a trade or business, covered by Business Profits article (net tax). If passive income from the leasing of equipment, and not in Royalty article, covered by the Other Income article, if any. In Pakistan payment for TV broadcasting rights are covered by the Royalty article but not rental income from motion picture films.
- z An exemption from tax or a reduced rate of tax may apply to interest that is paid to the government of a Contracting State or a political subdivision or local authority thereof. An exemption or reduced rate may also apply to certain other types of interest, including interest paid to certain banks or other financial institutions, interest derived on loans guaranteed or insured by the government of a Contracting State, and interest arising in connection with commercial credit for goods or services. Please refer to the interest article of the relevant treaty for specific information. Income Tax Treaties
- jj The rate is 15% (10% for Bulgaria and Spain; 30% for Austria, Germany, and Switzerland) for contingent interest that does not qualify as portfolio interest. In general, contingent interest is interest that is determined with reference to (a) receipts, sales, income, profits or other cash flow of the debtor or a related person, (b) any change in the value of any property of the debtor or a related person, or (c) any dividend, partnership distribution, or similar payment made by the debtor or related person. For Sweden and Germany, contingent interest is covered by the dividends article of the treaty.
- mm The rate in column 6 applies to dividends paid by a regulated investment company (RIC) or real estate investment trust (REIT). However, that rate applies to dividends paid by a REIT only if the beneficial owner of the dividends is (a) an individual (or pension fund, in some cases) holding not more than a 10% interest in the REIT, (b) a person holding not more than 5% of any class of the REIT's stock and the dividends are paid on stock that is publicly traded, or (c) a person holding not more than a 10% interest in the REIT and the REIT is diversified.
Notes to the services table (IRS Table 2)
- 2 Applies only if training or experience is received from a person other than alien's employer.
- 4 Does not apply to compensation for research work primarily for private benefit.
- 5 Grant must be from a nonprofit organization. In many cases, the exemption also applies to amounts from either the U.S. or foreign government. For Indonesia and the Netherlands, the exemption also applies if the amount is awarded under a technical assistance program entered into by the United States or the foreign government, or its political subdivisions or local authorities.
- 7 Exemption does not apply to the extent income is attributable to the recipient's fixed U.S. base. For residents of Korea and Norway, the fixed base must be maintained for more than 182 days (for Norway, 30 days in the case of the exploration or exploitation of the seabed and sub-soil and their natural resources); for residents of Morocco, the fixed base must be maintained for more than 89 days.
- 10 Applies to any additional period that a full-time student needs to complete the educational requirements as a candidate for a postgraduate or professional degree from a recognized educational institution.
- 12 Fees paid to a resident of the treaty country for services performed in the United States as a director of a U.S. corporation are subject to U.S. tax.
- 17 The exemption does not apply if the employee's compensation is borne by a permanent establishment (or in some cases a fixed base) that the employer has in the United States.
- 30 Exemption does not apply if gross receipts (or compensation for Portugal and Venezuela), including reimbursements, exceed this amount. Income is fully exempt if visit to the United States is substantially supported by public funds of the treaty country or its political subdivisions or local authorities.
- 40 The combined benefit for teaching cannot exceed 5 years.
- 58 Remuneration derived by a resident of a contracting State in respect of an employment as a member of the regular compliment of a ship or aircraft operated in international traffic may only be taxed in that State.
Transcribed from the IRS Tax Treaty Tables. Treaty texts and technical explanations: United States income tax treaties, A to Z.
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