Entitlement to Benefits. 1. Except as otherwise provided in this Article, a resident of a Contracting State that derives income from the other Contracting State shall be entitled to all the benefits under this Agreement for a taxable year only if such resident is a qualified person as defined in paragraph 2 and satisfies any other specified conditions in the relevant provisions of the Agreement for the obtaining of such benefits. 2. A resident of a Contracting State is a qualified person for a taxable year only if such resident is either: (a) an individual; (b) a qualified governmental entity; (c) a company, if its principal class of shares is listed or registered and is regularly traded on one or more recognised stock exchanges; (d) a pension fund or pension scheme, provided that, as of the end of the prior taxable year, more than 50 per cent of the beneficiaries, members or participants of that pension fund or pension scheme are individuals who are residents of either Contracting State; (e) a person established under the laws of that Contracting State and operated exclusively for a religious, charitable, educational, scientific, artistic, cultural or public purpose, only if all or part of its income may be exempt from tax under the laws of that Contracting State; or (f) a person other than an individual, if at least 65 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by residents of that Contracting State that are qualified persons by reason of subparagraph (a), (b), (c), (d) or (e). 3. Notwithstanding that a resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement in respect of an item of income derived from the other Contracting State if that resident satisfies any other specified conditions in the relevant provisions of the Agreement for the obtaining of such benefit and if: (a) at least 65 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement, be entitled to equivalent or more favourable benefits; or (b) at least 90 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement or an agreement that the Contracting State from which the item of income arise has concluded with another State, be entitled to equivalent or more favourable benefits. 4. Where the provisions of subparagraph (f) of paragraph 2 or paragraph 3 apply: (a) in respect of taxation by withholding at source, a resident of a Contracting State shall be considered to satisfy the conditions described in that subparagraph or that paragraph for the taxable year in which payment of an item of income is made if such resident satisfies those conditions during the twelve month period preceding the date of the payment (or, in the case of dividends, the date on which entitlement to the dividends is determined); (b) in all other cases, a resident of a Contracting State shall be considered to satisfy the conditions described in that subparagraph or that paragraph for a taxable year if such resident satisfies those conditions on at least half the days of the taxable year. (a) Notwithstanding that a resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement in respect of an item of income derived from the other Contracting State if: (i) that resident is engaged in the active conduct of a business (other than the business of making or managing investments for that resident’s own account, unless the business is banking, insurance or securities business carried on by a bank, insurance company or securities dealer) in the first- mentioned Contracting State; (ii) the income derived from that other Contracting State is derived in connection with, or is incidental to, that business; and (iii) that resident satisfies any other specified conditions in the relevant provisions of the Agreement for the obtaining of such benefit. (b) If a resident of a Contracting State derives an item of income from a business carried on by that resident in the other Contracting State or derives an item of income arising in the other Contracting State from a person that has with that resident a relationship described in subparagraph (a) or (b) of paragraph 1 of Article 9, the conditions described in subparagraph (a) of this paragraph shall be considered to be satisfied with respect to such item of income only if the business carried on in the first- mentioned Contracting State is substantial in relation to the business carried on in that other Contracting State. Whether such business is substantial for the purpose of this paragraph shall be determined on the basis of all the facts and circumstances. (c) In determining whether a person is engaged in the active conduct of a business in a Contracting State under subparagraph (a), the business conducted by a partnership in which that person is a partner, and the business conducted by a person connected to such person only to the extent that both persons are engaged in the same or complementary lines of business, shall be deemed to be conducted by such person. A person shall be connected to another if one owns, directly or indirectly, at least 50 per cent of the beneficial interests in the other (or, in the case of a company, at least 50 per cent of the voting shares of the company) or another person owns, directly or indirectly, at least 50 per cent of the beneficial interests (or, in the case of a company, at least 50 per cent of the voting shares of the company) in each person. In any case, a person shall be considered to be connected to another if, on the basis of all the facts and circumstances, one has control of the other or both are under the control of the same person or persons. 6. A resident of a Contracting State that is neither a qualified person nor entitled under paragraph 3 or 5 to the benefits referred to in those paragraphs shall, nevertheless, be granted all the benefits under this Agreement or a benefit under the Agreement in respect of an item of income derived from the other Contracting State if, upon request from that resident, the competent authority of that other Contracting State determines, in accordance with its domestic law or administrative practice, that the establishment, acquisition or maintenance of such resident and the conduct of its operations are considered as not having the obtaining of such benefits as one of the principal purposes. The competent authority of the Contracting State to which a request has been made under this paragraph by a resident of the other Contracting State will consult with the competent authority of that other Contracting State before rejecting the request. 7. For the purposes of this Article: (a) the term “qualified governmental entity” means the Government of a Contracting State, of a federal state (Land) thereof, or of any political subdivision or local authority thereof, the Bank of Japan, the Federal Bank of Germany (Deutsche Bundesbank) or a person that is wholly owned, directly or indirectly, by the Government of a Contracting State, of a federal state (Land) thereof, or of a political subdivision or local authority thereof;
Appears in 3 contracts
Samples: Agreement for the Elimination of Double Taxation, Agreement for the Elimination of Double Taxation, Agreement for the Elimination of Double Taxation
Entitlement to Benefits. 1. Except as otherwise provided in this Article, a resident of a Contracting State that derives income from the other Contracting State shall be entitled to all the benefits under this Agreement for a taxable year granted by the provisions of paragraph 3 of Article 10, paragraph 3 of Article 11 or paragraph 1 of Article 12 only if such resident is a qualified person as defined in paragraph 2 and satisfies any other specified conditions in the relevant provisions of the Agreement for the obtaining of such benefits2.
2. A resident of a Contracting State is a qualified person for a taxable year only if such resident is either:
(a) an individual;
(b) a qualified governmental entitythe Government of that Contracting State, any political subdivision or local authority thereof or the central bank thereof;
(c) a company, if its principal class of shares is listed or registered and is regularly traded on one or more recognised stock exchanges;
(d) a bank, an insurance company or a securities dealer that is established and regulated as such under the laws of that Contracting State;
(e) a pension fund or pension schemefund, provided that, that as of the end beginning of the prior taxable year, period in which the claim to the benefit is made:
(i) more than 50 per cent of the beneficiaries, members or participants of that the pension fund or pension scheme are individuals who are residents of either Contracting State; or
(ii) more than 75 per cent of the contributions made to the pension fund is derived from residents of either Contracting State which are qualified persons;
(ef) a person an organisation established under the laws of that Contracting State and operated exclusively for a religious, charitable, educational, scientific, artistic, cultural or public purpose, only if the tax laws of that Contracting State provide that all or part of its income may be exempt is exempted from tax under the laws or that such person is only subjected to tax with respect to some types of that Contracting Stateincome; or
(fg) a person other than an individual, if at least 65 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by residents of that either Contracting State that are qualified persons by reason of subparagraph either of subparagraphs (a)) to (f) own, (b)directly or indirectly, (c), (d) at least 50 per cent of the voting power or (e)other beneficial interests of the person.
3. Notwithstanding that a A resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement in granted by the provisions of paragraph 3 of Article 10, paragraph 3 of Article 11 or paragraph 1 of Article 12 with respect of to an item of income derived from the other Contracting State if that resident satisfies any other specified conditions described in the relevant provisions of the Agreement for the obtaining of such benefit and if:
(a) respective paragraph if persons that are equivalent beneficiaries own, directly or indirectly, at least 65 75 per cent of the voting shares power or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement, be entitled to equivalent or more favourable benefits; or
(b) at least 90 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement or an agreement that the Contracting State from which the item of income arise has concluded with another State, be entitled to equivalent or more favourable benefitsresident.
4. Where For the purposes of applying the provisions of subparagraph (fg) of paragraph 2 or and paragraph 3 apply:
(a) in respect of taxation by withholding at source3, a resident of a Contracting State shall be considered to satisfy the conditions described in that subparagraph or that paragraph for the taxable year in which payment of an item of income is made only if such resident satisfies those conditions during the twelve month period preceding the date of the payment (or, in the case of dividends, the date on which entitlement to the dividends is determined);.
(ba) in all other cases, a A resident of a Contracting State shall be considered to satisfy the conditions described in that subparagraph or that paragraph for a taxable year if such resident satisfies those conditions on at least half the days of the taxable year.
(a) Notwithstanding that a resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement in the benefits granted by the provisions of paragraph 3 of Article 10, paragraph 3 of Article 11 or paragraph 1 of Article 12 with respect of to an item of income described in the respective paragraph derived from the other Contracting State if:
(i) that the resident is engaged carrying on business in the active conduct of a business first-mentioned Contracting State (other than the business of making or managing investments for that the resident’s own account, unless the business is banking, insurance or securities business carried on by a bank, insurance company or securities dealer) in the first- mentioned Contracting State;); and
(ii) the that item of income derived from that other Contracting State is derived in connection with, or is incidental to, that business; and
(iii) that resident satisfies any other specified conditions in the relevant provisions of the Agreement for the obtaining of such benefit.
(b) If a resident of a Contracting State derives an item of income from a business carried on by that resident in the other Contracting State or derives an item of income arising in the other Contracting State from a person that has with that the resident a relationship described in subparagraph (a) or (b) of paragraph 1 of Article 9, the conditions described in subparagraph (a) of this paragraph shall be considered to be satisfied with respect to such item of income only if the business carried on in the first- first-mentioned Contracting State is substantial in relation to the business carried on in that other Contracting State. Whether such business is substantial for the purpose of this paragraph subparagraph shall be determined on the basis of all the facts and circumstances.
(c) In determining whether a person is engaged in the active conduct of a carrying on business in a Contracting State under subparagraph (a)) of this paragraph, the business conducted by a partnership in which that person is a partner, partner and the business conducted by a person persons connected to such person only to the extent that both persons are engaged in the same or complementary lines of business, shall be deemed to be conducted by such person. A person shall be connected to another if one owns, directly or indirectly, at least 50 per cent of the beneficial interests in the other (or, in the case of a company, at least 50 per cent of the voting shares power of the company) or another a third person owns, directly or indirectly, at least 50 per cent of the beneficial interests (or, in the case of a company, at least 50 per cent of the voting shares power of the company) in each person. In any case, a person shall be considered to be connected to another if, on the basis of all the facts and circumstances, one has control of the other or both are under the control of the same person or persons.
6(a) A resident of a Contracting State shall be entitled to the benefits granted by the provisions of paragraph 3 of Article 10, paragraph 3 of Article 11 or paragraph 1 of Article 12 with respect to an item of income described in the respective paragraph derived from the other Contracting State if:
(i) that resident functions as a headquarters company for a multinational corporate group; and
(ii) the item of income derived from that other Contracting State either is derived in connection with, or is incidental to, the business referred to in clause (ii) of subparagraph (b).
(b) A resident of a Contracting State shall be considered a headquarters company for a multinational corporate group for the purpose of subparagraph (a) only if:
(i) that resident provides a substantial portion of the overall supervision and administration of the group or provides financing for the group;
(ii) the group consists of companies which are residents in, and are carrying on business in, at least five countries, and the business carried on in each of the five countries generates at least 5 per cent of the gross income of the group;
(iii) the business carried on in any one country other than that Contracting State generate less than 50 per cent of the gross income of the group;
(iv) no more than 50 per cent of its gross income is derived from the other Contracting State;
(v) that resident has, and exercises, independent discretionary authority to carry out the functions referred to in clause (i); and
(vi) that resident is subject to the same income taxation rules in that Contracting State as persons described in paragraph 5.
(c) For the purposes of subparagraph (b), a resident of a Contracting State shall be deemed to satisfy the gross income requirements described in clause (ii), (iii) or (iv) of that subparagraph for the taxable period in which the item of income is derived if that resident satisfies each of those gross income requirements when averaging the gross income of the three taxable periods preceding that taxable period.
7. A resident of a Contracting State that is neither a qualified person nor entitled under paragraph 3 3, 5 or 5 6 to the benefits referred to in those paragraphs shall, nevertheless, be granted all the benefits under this Agreement or a benefit under granted by the Agreement in respect provisions of an item paragraph 3 of income derived from the other Contracting State ifArticle 10, upon request from that resident, paragraph 3 of Article 11 or paragraph 1 of Article 12 shall nevertheless be entitled to such benefits if the competent authority of that the other Contracting State determines, in accordance with its domestic law or administrative practice, that the establishment, acquisition or maintenance of such resident and the conduct of its operations are considered as did not having have the obtaining of such benefits as one of the principal purposes. The competent authority of the Contracting State to which a request has been made under this paragraph by a resident of the other Contracting State will consult with the competent authority of that other Contracting State before rejecting the request.
78. For the purposes of this Article:
(a) the term “qualified governmental entity” means the Government of a Contracting State, of a federal state (Land) thereof, or of any political subdivision or local authority thereof, the Bank of Japan, the Federal Bank of Germany (Deutsche Bundesbank) or a person that is wholly owned, directly or indirectly, by the Government of a Contracting State, of a federal state (Land) thereof, or of a political subdivision or local authority thereof;
Appears in 3 contracts
Samples: Convention for the Elimination of Double Taxation, Convention for the Elimination of Double Taxation, Convention for the Elimination of Double Taxation
Entitlement to Benefits. 1. Except as otherwise provided in paragraphs 3, 4 and 5 of this Article, a resident of a Contracting State that derives income from the other Contracting State shall not be entitled to all a benefit that would otherwise be accorded by the benefits under provisions of paragraph 3 of Article 10, paragraph 1 of Article 11 or paragraph 1 of Article 12 of this Agreement for a taxable year only if Convention, unless such resident is a qualified person as defined in paragraph 2 and satisfies any other specified conditions in of this Article at the relevant provisions of time that the Agreement for the obtaining of such benefitsbenefit would be accorded.
2. A resident of a Contracting State is shall be a qualified person for at a taxable year only if such time when a benefit would otherwise be accorded by the provisions referred to in paragraph 1 of this Article if, at that time, the resident is eitheris:
(a) an individual;
(b) a qualified governmental entitythat Contracting State, any subdivision or local authority thereof, or an agency or instrumentality of such Contracting State, subdivision or local authority;
(c) a companycompany or other entity, if its the principal class of its shares is listed or registered and is regularly traded on one or more recognised stock exchanges;
(d) a pension fund or pension schemefund, provided thatif, as at the beginning of the end of taxable year for which the prior taxable yearclaim to the benefit is made, more than at least 50 per cent of the its beneficiaries, members or participants of that pension fund or pension scheme are individuals who are residents of either Contracting State;
(e) a person established under the laws of that Contracting State and operated exclusively for a religious, charitable, educational, scientific, artistic, cultural or public purpose, only if all or part of its income may be exempt from tax under the laws of that Contracting State; or
(fe) a person other than an individual, if if, on at least 65 per cent half of the voting shares or other beneficial interests days of any twelve month period that includes the person time when the benefit would otherwise be accorded, persons that are owned, directly or indirectly, by residents of that Contracting State and that are qualified persons by reason entitled to benefits referred to in paragraph 1 of this Article under subparagraph (a), (b), (c), ) or (d) of this paragraph own, directly or (e)indirectly, at least 50 per cent of the shares of the person.
3. Notwithstanding that a A resident of a Contracting State may that is not be a qualified person, that resident person pursuant to the provisions of paragraph 2 of this Article shall also be entitled to a benefit under that would otherwise be accorded by the provisions of paragraph 3 of Article 10, paragraph 1 of Article 11 or paragraph 1 of Article 12 of this Agreement in Convention with respect of to an item of income derived from the other Contracting State if that resident satisfies any other specified conditions described in the relevant provisions of the Agreement for the obtaining of such benefit and respective paragraph if:
(a) at least 65 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement, be entitled to equivalent or more favourable benefits; or
(b) at least 90 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement or an agreement that the Contracting State from which the item of income arise has concluded with another State, be entitled to equivalent or more favourable benefits.
4. Where the provisions of subparagraph (f) of paragraph 2 or paragraph 3 apply:
(a) in respect of taxation by withholding at source, a resident of a Contracting State shall be considered to satisfy the conditions described in that subparagraph or that paragraph for the taxable year in which payment of an item of income is made if such resident satisfies those conditions during the twelve month period preceding the date of the payment (or, in the case of dividendsa pension fund, at the date on beginning of the taxable year for which entitlement the claim to the dividends benefit is determined);made, at least 75 per cent of its beneficiaries, members or participants are individuals who are equivalent beneficiaries; or
(b) in all other cases, a on at least half of the days of any twelve month period that includes the time when the benefit would otherwise be accorded, persons that are equivalent beneficiaries own, directly or indirectly, at least 75 per cent of the shares of the resident.
(a) A resident of a Contracting State shall be considered entitled to satisfy a benefit that would otherwise be accorded by the conditions provisions of paragraph 3 of Article 10, paragraph 1 of Article 11 or paragraph 1 of Article 12 of this Convention with respect to an item of income described in the respective paragraph that subparagraph or that paragraph for a taxable year if such is derived from the other Contracting State, regardless of whether the resident satisfies those conditions on at least half the days of the taxable year.
(a) Notwithstanding that a resident of a Contracting State may not be is a qualified person, that if the resident shall be entitled to is engaged in a benefit under this Agreement business activity in respect of an item of the first-mentioned Contracting State, and the income derived from the other Contracting State ifemanates from, or is incidental to, that business activity. For purposes of this paragraph, the term “a business activity” shall not include the following activities or any combination thereof:
(i) that resident is engaged in the active conduct operating as a holding company;
(ii) providing overall supervision or administration of a business group of companies;
(other than the business of iii) providing group financing (including cash pooling); or
(iv) making or managing investments for that resident’s own accountinvestments, unless the business is banking, insurance or securities business these activities are carried on by a bank, insurance company or registered securities dealer) dealer in the first- mentioned Contracting State;
(ii) the income derived from that other Contracting State is derived in connection with, or is incidental to, that business; and
(iii) that resident satisfies any other specified conditions in the relevant provisions ordinary course of the Agreement for the obtaining of such benefitits business as such.
(b) If a resident of a Contracting State derives an item of income from a business carried on activity conducted by that resident in the other Contracting State or derives an item of income arising in the other Contracting State from a person that has with that resident a relationship described in subparagraph (a) or (b) of paragraph 1 of Article 9connected person, the conditions described in subparagraph (a) of this paragraph shall be considered to be satisfied with respect to such item of income only if the business activity carried on by the resident in the first- first-mentioned Contracting State to which the item of income is related is substantial in relation to the same business activity or a complementary business activity carried on by the resident or such connected person in that the other Contracting State. Whether such a business activity is substantial for the purpose purposes of this paragraph subparagraph shall be determined based on the basis of all the facts and circumstances.
(c) In determining whether For purposes of applying this paragraph, business activities conducted by connected persons with respect to a person is engaged in the active conduct resident of a business in a Contracting State under subparagraph (a), the business conducted by a partnership in which that person is a partner, and the business conducted by a person connected to such person only to the extent that both persons are engaged in the same or complementary lines of business, shall be deemed to be conducted by such person. A person shall be connected to another if one owns, directly or indirectly, at least 50 per cent of the beneficial interests in the other (or, in the case of a company, at least 50 per cent of the voting shares of the company) or another person owns, directly or indirectly, at least 50 per cent of the beneficial interests (or, in the case of a company, at least 50 per cent of the voting shares of the company) in each person. In any case, a person shall be considered to be connected to another if, on the basis of all the facts and circumstances, one has control of the other or both are under the control of the same person or personsresident.
65. A If a resident of a Contracting State that is neither a qualified person pursuant to the provisions of paragraph 2 of this Article, nor entitled to benefits under paragraph 3 or 5 to the benefits referred to in those paragraphs shall, nevertheless, be granted all the benefits under 4 of this Agreement or a benefit under the Agreement in respect of an item of income derived from the other Contracting State if, upon request from that residentArticle, the competent authority of that the other Contracting State determinesmay, nevertheless, grant the benefits accorded by the provisions of paragraph 3 of Article 10, paragraph 1 of Article 11 or paragraph 1 of Article 12 of this Convention with respect to an item of income described in accordance with the respective paragraph, taking into account the object and purpose of this Convention, but only if such resident demonstrates to the satisfaction of such competent authority that neither its domestic law or administrative practice, that the establishment, acquisition or maintenance of such resident and maintenance, nor the conduct of its operations are considered operations, had as not having one of its principal purposes the obtaining of such benefits as one of the principal purposesbenefits. The competent authority of the Contracting State to which Before either granting or denying a request has been made under this paragraph by a resident of a Contracting State, the competent authority of the other Contracting State will to which the request has been made shall consult with the competent authority of that other the first-mentioned Contracting State before rejecting the requestState.
76. For the purposes of the preceding paragraphs of this Article:
(a) the term “qualified governmental entity” means the Government of a Contracting State, of a federal state (Land) thereof, or of any political subdivision or local authority thereof, the Bank of Japan, the Federal Bank of Germany (Deutsche Bundesbank) or a person that is wholly owned, directly or indirectly, by the Government of a Contracting State, of a federal state (Land) thereof, or of a political subdivision or local authority thereof;
Appears in 3 contracts
Samples: Convention for the Elimination of Double Taxation, Convention for the Elimination of Double Taxation, Convention for the Elimination of Double Taxation
Entitlement to Benefits. 1. Except as otherwise provided in this Article, a resident of a Contracting State that derives income from the other Contracting State shall not be entitled to all a benefit that would otherwise be accorded under the benefits under this Agreement for a taxable year only if provisions of paragraph 1 of Article 12 unless such resident is a qualified person person, as defined in paragraph 2 and satisfies any other specified conditions in 2, at the relevant provisions of time when the Agreement for the obtaining of such benefitsbenefit would otherwise be accorded.
2. A resident of a Contracting State is shall be a qualified person for at a taxable year only if such time when a benefit would otherwise be accorded under the provisions of paragraph 1 of Article 12 if, at that time, the resident is eitheris:
(a) an individual;
(b) that Contracting State, a qualified governmental entitypolitical subdivision or local authority thereof, the central bank of that Contracting State, or an agency or instrumentality of that Contracting State or political subdivision or local authority;
(c) a companycompany or other entity, if its the principal class of its shares is listed or registered and is regularly traded on one or more recognised stock exchanges;
(d) a pension fund or pension scheme, provided that, as of the end of the prior taxable year, more than 50 per cent of the beneficiaries, members or participants of that pension fund or pension scheme are individuals who are residents of either Contracting State;
(e) a person established under the laws of that Contracting State and operated exclusively for a religious, charitable, educational, scientific, artistic, cultural or public purpose, only if all or part of its income may be exempt from tax under the laws of that Contracting State; or
(fd) a person other than an individual, if if, at that time and on at least 65 per cent half of the voting shares or other beneficial interests days of the person a twelve month period that includes that time, persons that are owned, directly or indirectly, by residents of that Contracting State and that are qualified persons by reason of under subparagraph (a), (b), (c), (d) or (e).
3. Notwithstanding that a resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement in respect of an item of income derived from the other Contracting State if that resident satisfies any other specified conditions in the relevant provisions of the Agreement for the obtaining of such benefit and if:
(a) at least 65 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement, be entitled to equivalent or more favourable benefits; or
(b) at least 90 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement or an agreement that the Contracting State from which the item of income arise has concluded with another State, be entitled to equivalent or more favourable benefits.
4. Where the provisions of subparagraph (f) of paragraph 2 or paragraph 3 apply:
(a) in respect of taxation by withholding at source, a resident of a Contracting State shall be considered to satisfy the conditions described in that subparagraph or that paragraph for the taxable year in which payment of an item of income is made if such resident satisfies those conditions during the twelve month period preceding the date of the payment (or, in the case of dividends, the date on which entitlement to the dividends is determined);
(b) in all other cases, a resident of a Contracting State shall be considered to satisfy the conditions described in that subparagraph or that paragraph for a taxable year if such resident satisfies those conditions on at least half the days of the taxable year.
(a) Notwithstanding that a resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement in respect of an item of income derived from the other Contracting State if:
(i) that resident is engaged in the active conduct of a business (other than the business of making or managing investments for that resident’s own account, unless the business is banking, insurance or securities business carried on by a bank, insurance company or securities dealer) in the first- mentioned Contracting State;
(ii) the income derived from that other Contracting State is derived in connection with, or is incidental to, that business; and
(iii) that resident satisfies any other specified conditions in the relevant provisions of the Agreement for the obtaining of such benefit.
(b) If a resident of a Contracting State derives an item of income from a business carried on by that resident in the other Contracting State or derives an item of income arising in the other Contracting State from a person that has with that resident a relationship described in subparagraph (a) or (b) of paragraph 1 of Article 9, the conditions described in subparagraph (a) of this paragraph shall be considered to be satisfied with respect to such item of income only if the business carried on in the first- mentioned Contracting State is substantial in relation to the business carried on in that other Contracting State. Whether such business is substantial for the purpose of this paragraph shall be determined on the basis of all the facts and circumstances.
(c) In determining whether a person is engaged in the active conduct of a business in a Contracting State under subparagraph (a), the business conducted by a partnership in which that person is a partner, and the business conducted by a person connected to such person only to the extent that both persons are engaged in the same or complementary lines of business, shall be deemed to be conducted by such person. A person shall be connected to another if one ownsown, directly or indirectly, at least 50 per cent of the beneficial interests in the other (or, in the case of a company, at least 50 per cent of the voting shares of the company) or another person owns, directly or indirectly, at least 50 per cent of the beneficial interests (or, in the case of a company, at least 50 per cent of the voting shares of the company) in each person. In any case, a person shall be considered to be connected to another if, on the basis of all the facts and circumstances, one has control of the other or both are under the control of the same person or persons.
63. A If a resident of a Contracting State that is neither not a qualified person nor entitled under paragraph 3 or 5 to the benefits referred to in those paragraphs shall, nevertheless, be granted all the benefits under this Agreement or a benefit under the Agreement in respect of an item of income derived from the other Contracting State if, upon request from that residentperson, the competent authority of that other the Contracting State determinesin which a benefit is denied under the preceding paragraphs of this Article may, in accordance with nevertheless, grant a benefit that would otherwise be accorded under the provisions of paragraph 1 of Article 12, taking into account the object and purpose of this Convention, but only if such resident demonstrates to the satisfaction of such competent authority that neither its domestic law or administrative practice, that the establishment, acquisition or maintenance of such resident and maintenance, nor the conduct of its operations are considered operations, had as not having one of its principal purposes the obtaining of such benefits as one of the principal purposesbenefit. The competent authority of the Contracting State to which a request has been made under this paragraph by a resident of the other Contracting State will shall consult with the competent authority of that other Contracting State before rejecting either granting or denying the request.
74. For the purposes of this Article:
(a) the term “qualified governmental entity” means the Government of a Contracting State, of a federal state (Land) thereof, or of any political subdivision or local authority thereof, the Bank of Japan, the Federal Bank of Germany (Deutsche Bundesbank) or a person that is wholly owned, directly or indirectly, by the Government of a Contracting State, of a federal state (Land) thereof, or of a political subdivision or local authority thereof;
Appears in 3 contracts
Samples: Convention for the Elimination of Double Taxation, Convention for the Elimination of Double Taxation, Convention for the Elimination of Double Taxation
Entitlement to Benefits. 1. Except as otherwise provided in this Article, a resident of a Contracting State that derives income from the other Contracting State shall not be entitled to all a benefit that would otherwise be accorded under the benefits under this Agreement for a taxable year only if provisions of paragraph 3 of Article 12 unless such resident is a qualified person person, as defined in paragraph 2 and satisfies any other specified conditions in 2, at the relevant provisions of time when the Agreement for the obtaining of such benefitsbenefit would otherwise be accorded.
2. A resident of a Contracting State is shall be a qualified person for at a taxable year only if such time when a benefit would otherwise be accorded under the provisions of paragraph 3 of Article 12 if, at that time, the resident is eitheris:
(a) an individual;
(b) that Contracting State, a qualified governmental entitysubdivision or local authority thereof, the central bank of that Contracting State, or an agency or instrumentality of that Contracting State or subdivision or local authority;
(c) a companycompany or other entity, if its the principal class of its shares is listed or registered and is regularly traded on one or more recognised stock exchanges;
(d) a pension fund or pension scheme, provided that, as of the end of the prior taxable year, more than 50 per cent of the beneficiaries, members or participants of that pension fund or pension scheme are individuals who are residents of either Contracting State;
(e) a person established under the laws of that Contracting State and operated exclusively for a religious, charitable, educational, scientific, artistic, cultural or public purpose, only if all or part of its income may be exempt from tax under the laws of that Contracting State; or
(fd) a person other than an individual, if if, at that time and on at least 65 per cent half of the voting shares or other beneficial interests days of the person a twelve month period that includes that time, persons that are owned, directly or indirectly, by residents of that Contracting State and that are qualified persons by reason of under subparagraph (a), (b), (c), (d) or (e).
3. Notwithstanding that a resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement in respect of an item of income derived from the other Contracting State if that resident satisfies any other specified conditions in the relevant provisions of the Agreement for the obtaining of such benefit and if:
(a) at least 65 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement, be entitled to equivalent or more favourable benefits; or
(b) at least 90 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement or an agreement that the Contracting State from which the item of income arise has concluded with another State, be entitled to equivalent or more favourable benefits.
4. Where the provisions of subparagraph (f) of paragraph 2 or paragraph 3 apply:
(a) in respect of taxation by withholding at source, a resident of a Contracting State shall be considered to satisfy the conditions described in that subparagraph or that paragraph for the taxable year in which payment of an item of income is made if such resident satisfies those conditions during the twelve month period preceding the date of the payment (or, in the case of dividends, the date on which entitlement to the dividends is determined);
(b) in all other cases, a resident of a Contracting State shall be considered to satisfy the conditions described in that subparagraph or that paragraph for a taxable year if such resident satisfies those conditions on at least half the days of the taxable year.
(a) Notwithstanding that a resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement in respect of an item of income derived from the other Contracting State if:
(i) that resident is engaged in the active conduct of a business (other than the business of making or managing investments for that resident’s own account, unless the business is banking, insurance or securities business carried on by a bank, insurance company or securities dealer) in the first- mentioned Contracting State;
(ii) the income derived from that other Contracting State is derived in connection with, or is incidental to, that business; and
(iii) that resident satisfies any other specified conditions in the relevant provisions of the Agreement for the obtaining of such benefit.
(b) If a resident of a Contracting State derives an item of income from a business carried on by that resident in the other Contracting State or derives an item of income arising in the other Contracting State from a person that has with that resident a relationship described in subparagraph (a) or (b) of paragraph 1 of Article 9, the conditions described in subparagraph (a) of this paragraph shall be considered to be satisfied with respect to such item of income only if the business carried on in the first- mentioned Contracting State is substantial in relation to the business carried on in that other Contracting State. Whether such business is substantial for the purpose of this paragraph shall be determined on the basis of all the facts and circumstances.
(c) In determining whether a person is engaged in the active conduct of a business in a Contracting State under subparagraph (a), the business conducted by a partnership in which that person is a partner, and the business conducted by a person connected to such person only to the extent that both persons are engaged in the same or complementary lines of business, shall be deemed to be conducted by such person. A person shall be connected to another if one ownsown, directly or indirectly, at least 50 per cent of the beneficial interests in the other (or, in the case of a company, at least 50 per cent of the voting shares of the company) or another person owns, directly or indirectly, at least 50 per cent of the beneficial interests (or, in the case of a company, at least 50 per cent of the voting shares of the company) in each person. In any case, a person shall be considered to be connected to another if, on the basis of all the facts and circumstances, one has control of the other or both are under the control of the same person or persons.
63. A If a resident of a Contracting State that is neither not a qualified person nor entitled under paragraph 3 or 5 to the benefits referred to in those paragraphs shall, nevertheless, be granted all the benefits under this Agreement or a benefit under the Agreement in respect of an item of income derived from the other Contracting State if, upon request from that residentperson, the competent authority of that other the Contracting State determinesin which a benefit is denied under the preceding paragraphs of this Article may, nevertheless, grant a benefit that would otherwise be accorded under the provisions of paragraph 3 of Article 12 with respect to an item of income described in accordance with that paragraph, taking into account the object and purpose of this Convention, but only if such resident demonstrates to the satisfaction of such competent authority that neither its domestic law or administrative practice, that the establishment, acquisition or maintenance of such resident and maintenance, nor the conduct of its operations are considered operations, had as not having one of its principal purposes the obtaining of such benefits as one of the principal purposesbenefit. The competent authority of the Contracting State to which a request has been made under this paragraph by a resident of the other Contracting State will shall consult with the competent authority of that other Contracting State before rejecting either granting or denying the request.
74. For the purposes of this Article:
(a) the term “qualified governmental entity” means the Government of a Contracting State, of a federal state (Land) thereof, or of any political subdivision or local authority thereof, the Bank of Japan, the Federal Bank of Germany (Deutsche Bundesbank) or a person that is wholly owned, directly or indirectly, by the Government of a Contracting State, of a federal state (Land) thereof, or of a political subdivision or local authority thereof;
Appears in 2 contracts
Samples: Convention for the Elimination of Double Taxation, Convention for the Elimination of Double Taxation
Entitlement to Benefits. 1. Except as otherwise provided in this Article, a resident of a Contracting State that derives income from the other Contracting State shall not be entitled to all a benefit that would otherwise be accorded under the benefits under this Agreement for a taxable year only if provisions of paragraph 5 of Article 7 or Article 10, 11, 12 or 13 unless such resident is a qualified person person, as defined in paragraph 2 and satisfies any other specified conditions in 2, at the relevant provisions of time when the Agreement for the obtaining of such benefitsbenefit would otherwise be accorded.
2. A resident of a Contracting State is shall be a qualified person for at a taxable year only if such time when a benefit would otherwise be accorded under the provisions of paragraph 5 of Article 7 or Article 10, 11, 12 or 13 if, at that time, the resident is eitheris:
(a) an individual;
(b) that Contracting State, a qualified governmental entitypolitical subdivision or local authority thereof, the central bank of that Contracting State, or an agency or instrumentality of that Contracting State or political subdivision or local authority;
(c) a companycompany or other entity, if its the principal class of its shares is listed or registered and is regularly traded on one or more recognised stock exchanges;
(d) a recognised pension fund or pension schemefund, provided thatif, as at the beginning of the end of taxable year for which the prior taxable yearclaim to the benefit is made, more than at least 50 per cent of the its beneficiaries, members or participants of that pension fund or pension scheme are individuals who are residents of either Contracting State;
(e) a person established under the laws of that Contracting State and operated exclusively for a religious, charitable, educational, scientific, artistic, cultural or public purpose, only if all or part of its income may be exempt from tax under the laws of that Contracting State; or
(fe) a person other than an individual, if if, at that time and on at least 65 per cent half of the voting shares or other beneficial interests days of the person a twelve month period that includes that time, persons that are owned, directly or indirectly, by residents of that Contracting State and that are qualified persons by reason of under subparagraph (a), (b), (c), ) or (d) or (e).
3. Notwithstanding that a resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement in respect of an item of income derived from the other Contracting State if that resident satisfies any other specified conditions in the relevant provisions of the Agreement for the obtaining of such benefit and if:
(a) at least 65 per cent of the voting shares or other beneficial interests of the person are ownedown, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement, be entitled to equivalent or more favourable benefits; or
(b) at least 90 50 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement or an agreement that the Contracting State from which the item of income arise has concluded with another State, be entitled to equivalent or more favourable benefitsperson.
4. Where the provisions of subparagraph (f) of paragraph 2 or paragraph 3 apply:
(a) in respect of taxation by withholding at source, a A resident of a Contracting State shall be considered entitled to satisfy a benefit that would otherwise be accorded under the conditions described in that subparagraph provisions of paragraph 5 of Article 7 or that paragraph for the taxable year in which payment of Article 10, 11, 12 or 13 with respect to an item of income is made if such resident satisfies those conditions during the twelve month period preceding the date of the payment (or, described in the case of dividends, the date on which entitlement to the dividends respective paragraph or Article that is determined);
(b) in all other cases, a resident of a Contracting State shall be considered to satisfy the conditions described in that subparagraph or that paragraph for a taxable year if such resident satisfies those conditions on at least half the days of the taxable year.
(a) Notwithstanding that a resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement in respect of an item of income derived from the other Contracting State if:
(i) that State, regardless of whether the resident is a qualified person, if the resident is engaged in the active conduct of a business (other than the business of making or managing investments for that resident’s own account, unless the business is banking, insurance or securities business carried on by a bank, insurance company or securities dealer) in the first- first-mentioned Contracting State;
(ii) , and the income derived from that the other Contracting State is derived in connection withemanates from, or is incidental to, that business; and. For purposes of this paragraph, the term “active conduct of a business” shall not include the following activities or any combination thereof:
(i) operating as a holding company;
(ii) providing overall supervision or administration of a group of companies;
(iii) that resident satisfies any other specified conditions providing group financing (including cash pooling);
(iv) making or managing investments, unless these activities are carried on by a bank, insurance enterprise or registered securities dealer in the relevant provisions ordinary course of the Agreement for the obtaining of such benefitits business as such; or
(v) holding or managing intangible property without producing or developing it.
(b) If a resident of a Contracting State derives an item of income from a business carried on activity conducted by that resident in the other Contracting State State, or derives an item of income arising in the other Contracting State from a person that has with that resident a relationship described in subparagraph (a) or (b) of paragraph 1 of Article 9connected person, the conditions described in subparagraph (a) of this paragraph shall be considered to be satisfied with respect to such item of income only if the business activity carried on by the resident in the first- first-mentioned Contracting State to which the item of income is related is substantial in relation to the same or complementary business activity carried on by the resident or such connected person in that the other Contracting State. Whether such a business activity is substantial for the purpose purposes of this paragraph shall be determined based on the basis of all the facts and circumstances.
(c) In determining whether For purposes of applying this paragraph, business activities conducted by connected persons with respect to a person is engaged in the active conduct resident of a business in a Contracting State under subparagraph (a), the business conducted by a partnership in which that person is a partner, and the business conducted by a person connected to such person only to the extent that both persons are engaged in the same or complementary lines of business, shall be deemed to be conducted by such person. A person shall be connected to another if one owns, directly or indirectly, at least 50 per cent of the beneficial interests in the other (or, in the case of a company, at least 50 per cent of the voting shares of the company) or another person owns, directly or indirectly, at least 50 per cent of the beneficial interests (or, in the case of a company, at least 50 per cent of the voting shares of the company) in each person. In any case, a person shall be considered to be connected to another if, on the basis of all the facts and circumstances, one has control of the other or both are under the control of the same person or personsresident.
64. A resident of a Contracting State that is not a qualified person shall nevertheless be entitled to a benefit that would otherwise be accorded under the provisions of paragraph 5 of Article 7 or Article 10, 11, 12 or 13 with respect to an item of income described in the respective paragraph or Article if:
(a) in the case of a recognised pension fund, at the beginning of the taxable year for which the claim to the benefit is made, at least 75 per cent of its beneficiaries, members or participants are individuals who are equivalent beneficiaries; or
(b) in all other cases, at the time when the benefit would otherwise be accorded and on at least half of the days of a twelve month period that includes that time, persons that are equivalent beneficiaries own, directly or indirectly, at least 75 per cent of the shares of the resident.
5. If a resident of a Contracting State is neither a qualified person person, nor entitled to a benefit under paragraph 3 or 5 to the benefits referred to in those paragraphs shall, nevertheless, be granted all the benefits under this Agreement or a benefit under the Agreement in respect of an item of income derived from the other Contracting State if, upon request from that resident4, the competent authority of that other the Contracting State determinesin which a benefit is denied under the preceding paragraphs of this Article may, nevertheless, grant a benefit that would otherwise be accorded under the provisions of paragraph 5 of Article 7 or Article 10, 11, 12 or 13 with respect to an item of income described in accordance with the respective paragraph or Article, taking into account the object and purpose of this Convention, but only if such resident demonstrates to the satisfaction of such competent authority that neither its domestic law or administrative practice, that the establishment, acquisition or maintenance of such resident and maintenance, nor the conduct of its operations are considered operations, had as not having one of its principal purposes the obtaining of such benefits as one of the principal purposesbenefit. The competent authority of the Contracting State to which a request has been made under this paragraph by a resident of the other Contracting State will shall consult with the competent authority of that other Contracting State before rejecting either granting or denying the request.
76. For the purposes of this Article:
(a) the term “qualified governmental entity” means the Government of a Contracting State, of a federal state (Land) thereof, or of any political subdivision or local authority thereof, the Bank of Japan, the Federal Bank of Germany (Deutsche Bundesbank) or a person that is wholly owned, directly or indirectly, by the Government of a Contracting State, of a federal state (Land) thereof, or of a political subdivision or local authority thereof;
Appears in 2 contracts
Samples: Convention for the Elimination of Double Taxation, Convention for the Elimination of Double Taxation
Entitlement to Benefits. 1. Except as otherwise provided in this Article, a resident of a Contracting State that derives income from the other Contracting State shall not be entitled to all a benefit that would otherwise be accorded under the benefits under this Agreement for a taxable year only if provisions of paragraph 3 of Article 10, paragraph 1 of Article 11 or paragraph 1 of Article 12 unless such resident is a qualified person person, as defined in paragraph 2 and satisfies any other specified conditions in 2, at the relevant provisions of time when the Agreement for the obtaining of such benefitsbenefit would otherwise be accorded.
2. A resident of a Contracting State is shall be a qualified person for at a taxable year only if such time when a benefit would otherwise be accorded under the provisions of paragraph 3 of Article 10, paragraph 1 of Article 11 or paragraph 1 of Article 12 if, at that time, the resident is eitheris:
(a) an individual;
(b) that Contracting State, a qualified governmental entitypolitical subdivision or local authority thereof, the central bank of that Contracting State, or an agency or instrumentality of that Contracting State or political subdivision or local authority;
(c) a companycompany or other entity, if its the principal class of its shares is listed or registered and is regularly traded on one or more recognised stock exchanges;
(d) a recognised pension fund or pension schemefund, provided thatif, as at the beginning of the end of taxable year for which the prior taxable yearclaim to the benefit is made, more than at least 50 per cent of the its beneficiaries, members or participants of that pension fund or pension scheme are individuals who are residents of either Contracting State;
(e) a person established under the laws of that Contracting State and operated exclusively for a religious, charitable, educational, scientific, artistic, cultural or public purpose, only if all or part of its income may be exempt from tax under the laws of that Contracting State; or
(fe) a person other than an individual, if if, at that time and on at least 65 per cent half of the voting shares or other beneficial interests days of the person a twelve month period that includes that time, persons that are owned, directly or indirectly, by residents of that Contracting State and that are qualified persons by reason of under subparagraph (a), (b), (c), ) or (d) or (e).
3. Notwithstanding that a resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement in respect of an item of income derived from the other Contracting State if that resident satisfies any other specified conditions in the relevant provisions of the Agreement for the obtaining of such benefit and if:
(a) at least 65 per cent of the voting shares or other beneficial interests of the person are ownedown, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement, be entitled to equivalent or more favourable benefits; or
(b) at least 90 50 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement or an agreement that the Contracting State from which the item of income arise has concluded with another State, be entitled to equivalent or more favourable benefitsperson.
4. Where the provisions of subparagraph (f) of paragraph 2 or paragraph 3 apply:
(a) in respect of taxation by withholding at source, a A resident of a Contracting State shall be considered entitled to satisfy a benefit that would otherwise be accorded under the conditions described in that subparagraph provisions of paragraph 3 of Article 10, paragraph 1 of Article 11 or that paragraph for the taxable year in which payment 1 of Article 12 with respect to an item of income is made if such resident satisfies those conditions during the twelve month period preceding the date of the payment (or, described in the case of dividends, the date on which entitlement to the dividends respective paragraph that is determined);
(b) in all other cases, a resident of a Contracting State shall be considered to satisfy the conditions described in that subparagraph or that paragraph for a taxable year if such resident satisfies those conditions on at least half the days of the taxable year.
(a) Notwithstanding that a resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement in respect of an item of income derived from the other Contracting State if:
(i) that State, regardless of whether the resident is a qualified person, if the resident is engaged in the active conduct of a business (other than the business of making or managing investments for that resident’s own account, unless the business is banking, insurance or securities business carried on by a bank, insurance company or securities dealer) in the first- first-mentioned Contracting State;
(ii) , and the income derived from that the other Contracting State is derived in connection withemanates from, or is incidental to, that business; and. For purposes of this paragraph, the term “active conduct of a business” shall not include the following activities or any combination thereof:
(i) operating as a holding company;
(ii) providing overall supervision or administration of a group of companies;
(iii) that resident satisfies any other specified conditions providing group financing (including cash pooling);
(iv) making or managing investments, unless these activities are carried on by a bank, insurance enterprise or registered securities dealer in the relevant provisions ordinary course of the Agreement for the obtaining of such benefitits business as such; or
(v) holding or managing intangible property without producing or developing it.
(b) If a resident of a Contracting State derives an item of income from a business carried on activity conducted by that resident in the other Contracting State State, or derives an item of income arising in the other Contracting State from a person that has with that resident a relationship described in subparagraph (a) or (b) of paragraph 1 of Article 9connected person, the conditions described in subparagraph (a) of this paragraph shall be considered to be satisfied with respect to such item of income only if the business activity carried on by the resident in the first- first-mentioned Contracting State to which the item of income is related is substantial in relation to the same or complementary business activity carried on by the resident or such connected person in that the other Contracting State. Whether such a business activity is substantial for the purpose purposes of this paragraph shall be determined based on the basis of all the facts and circumstances.
(c) In determining whether For purposes of applying this paragraph, business activities conducted by connected persons with respect to a person is engaged in the active conduct resident of a business in a Contracting State under subparagraph (a), the business conducted by a partnership in which that person is a partner, and the business conducted by a person connected to such person only to the extent that both persons are engaged in the same or complementary lines of business, shall be deemed to be conducted by such person. A person shall be connected to another if one owns, directly or indirectly, at least 50 per cent of the beneficial interests in the other (or, in the case of a company, at least 50 per cent of the voting shares of the company) or another person owns, directly or indirectly, at least 50 per cent of the beneficial interests (or, in the case of a company, at least 50 per cent of the voting shares of the company) in each person. In any case, a person shall be considered to be connected to another if, on the basis of all the facts and circumstances, one has control of the other or both are under the control of the same person or personsresident.
64. A resident of a Contracting State that is neither not a qualified person nor shall nevertheless be entitled to a benefit that would otherwise be accorded under the provisions of paragraph 3 of Article 10, paragraph 1 of Article 11 or 5 paragraph 1 of Article 12 with respect to the benefits referred to in those paragraphs shall, nevertheless, be granted all the benefits under this Agreement or a benefit under the Agreement in respect of an item of income described in the respective paragraph if:
(a) in the case of a recognised pension fund, at the beginning of the taxable year for which the claim to the benefit is made, at least 75 per cent of its beneficiaries, members or participants are individuals who are equivalent beneficiaries; or
(b) in all other cases, at the time when the benefit would otherwise be accorded and on at least half of the days of a twelve month period that includes that time, persons that are equivalent beneficiaries own, directly or indirectly, at least 75 per cent of the shares of the resident.
(a) A company that is a resident of a Contracting State that functions as a headquarters company for a multinational corporate group consisting of such company and its direct and indirect subsidiaries shall be entitled to a benefit that would otherwise be accorded under the provisions of paragraph 3 of Article 10, paragraph 1 of Article 11 or paragraph 1 of Article 12 with respect to an item of income described in the respective paragraph that is derived from the other Contracting State ifState, upon request regardless of whether the resident is a qualified person, if the income derived from that residentother Contracting State emanates from, or is incidental to, the business referred to in clause (ii) of subparagraph (b).
(b) A company, being a resident of a Contracting State, shall be considered a headquarters company for a multinational corporate group for the purpose of subparagraph (a) only if:
(i) such company provides a substantial portion of the overall supervision and administration of the group or provides financing for the group;
(ii) the group consists of companies which are residents of, and are engaged in the active conduct of a business in, at least four states, and the businesses carried on in each of the four states (or four groupings of states) generate at least 5 per cent of the gross income of the group;
(iii) the businesses of the group that are carried on in any one state other than that Contracting State generate less than 50 per cent of the gross income of the group;
(iv) no more than 50 per cent of such company’s gross income is derived from the other Contracting State;
(v) such company has, and exercises, independent discretionary authority to carry out the functions referred to in clause (i); and
(vi) such company is subject to the same income taxation rules in that Contracting State as persons described in paragraph 3.
(c) For the purposes of subparagraph (b), the requirements of clause (ii), (iii) or (iv) of that subparagraph shall be deemed to be fulfilled for the taxable period in which the item of income is derived if the required ratios are met when averaging the gross income of the preceding four taxable periods.
6. If a resident of a Contracting State is neither a qualified person, nor entitled to a benefit under paragraph 3, 4 or 5, the competent authority of that other the Contracting State determinesin which a benefit is denied under the preceding paragraphs of this Article may, nevertheless, grant a benefit that would otherwise be accorded under the provisions of paragraph 3 of Article 10, paragraph 1 of Article 11 or paragraph 1 of Article 12 with respect to an item of income described in accordance with the respective paragraph, taking into account the object and purpose of this Convention, but only if such resident demonstrates to the satisfaction of such competent authority that neither its domestic law or administrative practice, that the establishment, acquisition or maintenance of such resident and maintenance, nor the conduct of its operations are considered operations, had as not having one of its principal purposes the obtaining of such benefits as one of the principal purposesbenefit. The competent authority of the Contracting State to which a request has been made under this paragraph by a resident of the other Contracting State will shall consult with the competent authority of that other Contracting State before rejecting either granting or denying the request.
7. For the purposes of this Article:
(a) the term “qualified governmental entity” means the Government of a Contracting State, of a federal state (Land) thereof, or of any political subdivision or local authority thereof, the Bank of Japan, the Federal Bank of Germany (Deutsche Bundesbank) or a person that is wholly owned, directly or indirectly, by the Government of a Contracting State, of a federal state (Land) thereof, or of a political subdivision or local authority thereof;
Appears in 2 contracts
Samples: Convention for the Elimination of Double Taxation, Convention for the Elimination of Double Taxation
Entitlement to Benefits. 1. Except as otherwise provided in this Article, a resident of a Contracting State that derives income from Notwithstanding the other Contracting State shall be entitled to all the benefits under this Agreement for a taxable year only if such resident is a qualified person as defined in paragraph 2 and satisfies any other specified conditions in the relevant provisions of the Agreement for the obtaining of such benefits.
2. A resident of a Contracting State is a qualified person for a taxable year only if such resident is either:
(a) an individual;
(b) a qualified governmental entity;
(c) a companythis Agreement, if its principal class of shares is listed or registered and is regularly traded on one or more recognised stock exchanges;
(d) a pension fund or pension scheme, provided that, as of the end of the prior taxable year, more than 50 per cent of the beneficiaries, members or participants of that pension fund or pension scheme are individuals who are residents of either Contracting State;
(e) a person established under the laws of that Contracting State and operated exclusively for a religious, charitable, educational, scientific, artistic, cultural or public purpose, only if all or part of its income may be exempt from tax under the laws of that Contracting State; or
(f) a person other than an individual, if at least 65 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by residents of that Contracting State that are qualified persons by reason of subparagraph (a), (b), (c), (d) or (e).
3. Notwithstanding that a resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement shall not be granted in respect of an item of income derived from or capital if it is reasonable to conclude, having regard to all relevant facts and circumstances, that obtaining that benefit was one of the other Contracting State if principal purposes of any arrangement or transaction that resident satisfies any other specified conditions resulted directly or indirectly in that benefit, unless it is estab- lished that granting that benefit in these circumstances would be in accordance with the object and purpose of the relevant provisions of the Agreement for the obtaining of such benefit and if:
(a) at least 65 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the this Agreement, be entitled to equivalent or more favourable benefits; or
(b) at least 90 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement or an agreement that the Contracting State from which the item of income arise has concluded with another State, be entitled to equivalent or more favourable benefits.
42. Where the provisions of subparagraph (f) of paragraph 2 or paragraph 3 apply:
(a) in respect of taxation by withholding at source, a resident of a Contracting State shall be considered to satisfy the conditions described in that subparagraph or that paragraph for the taxable year in which payment of an item of income is made if such resident satisfies those conditions during the twelve month period preceding the date of the payment (or, in the case of dividends, the date on which entitlement to the dividends is determined);
(b) in all other cases, a resident of a Contracting State shall be considered to satisfy the conditions described in that subparagraph or that paragraph for a taxable year if such resident satisfies those conditions on at least half the days of the taxable year.
(a) Notwithstanding that a resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement in is denied to a person under paragraph 1, the competent authority of the Contracting State that would otherwise have xxxxx- xx this benefit shall nevertheless treat that person as being entitled to this benefit, or to different benefits with respect of an to a specific item of income derived from the other Contracting State if:
(i) that resident is engaged in the active conduct of a business (other than the business of making or managing investments for that resident’s own accountcapital, unless the business is banking, insurance or securities business carried on by a bank, insurance company or securities dealer) in the first- mentioned Contracting State;
(ii) the income derived from that other Contracting State is derived in connection with, or is incidental to, that business; and
(iii) that resident satisfies any other specified conditions in the relevant provisions of the Agreement for the obtaining of if such benefit.
(b) If a resident of a Contracting State derives an item of income from a business carried on by that resident in the other Contracting State or derives an item of income arising in the other Contracting State from a person that has with that resident a relationship described in subparagraph (a) or (b) of paragraph 1 of Article 9, the conditions described in subparagraph (a) of this paragraph shall be considered to be satisfied with respect to such item of income only if the business carried on in the first- mentioned Contracting State is substantial in relation to the business carried on in that other Contracting State. Whether such business is substantial for the purpose of this paragraph shall be determined on the basis of all the facts and circumstances.
(c) In determining whether a person is engaged in the active conduct of a business in a Contracting State under subparagraph (a), the business conducted by a partnership in which that person is a partner, and the business conducted by a person connected to such person only to the extent that both persons are engaged in the same or complementary lines of business, shall be deemed to be conducted by such person. A person shall be connected to another if one owns, directly or indirectly, at least 50 per cent of the beneficial interests in the other (or, in the case of a company, at least 50 per cent of the voting shares of the company) or another person owns, directly or indirectly, at least 50 per cent of the beneficial interests (or, in the case of a company, at least 50 per cent of the voting shares of the company) in each person. In any case, a person shall be considered to be connected to another if, on the basis of all the facts and circumstances, one has control of the other or both are under the control of the same person or persons.
6. A resident of a Contracting State that is neither a qualified person nor entitled under paragraph 3 or 5 to the benefits referred to in those paragraphs shall, nevertheless, be granted all the benefits under this Agreement or a benefit under the Agreement in respect of an item of income derived from the other Contracting State ifcompetent authority, upon request from that residentperson and after consideration of the relevant facts and circumstances, the competent authority of determines that other Contracting State determinessuch benefits would have been granted to that person, or to another person, in accordance with its domestic law or administrative practice, that the establishment, acquisition or maintenance of such resident and the conduct of its operations are considered as not having the obtaining of such benefits as one absence of the principal purposestransaction or arrangement referred to in paragraph 1. The competent authority of the Contracting Contract- ing State to which a the request has been made will consult with the competent au- thority of the other State before rejecting a request made under this paragraph by a resident of the other Contracting State will consult with the competent authority of that other Contracting State."
1. The title of the Protocol to the Agreement shall be replaced by the following: "PROTOCOL With respect to the Agreement concluded between the Swiss Confederation and the State before rejecting of Kuwait for the requestavoidance of double taxation with respect to taxes on income and on capital and the prevention of tax evasion and avoidance, the under- signed have agreed that the following provisions shall form an integral part of the Agreement.”
2. Paragraph 4 of the Protocol to the Agreement shall be renumbered as paragraph 5 and its subparagraphs 1 and 2 shall be renamed to subparagraphs a) and b).
73. For The following new paragraph 4 shall be added to the purposes Protocol to the Agreement: “
4. With respect to paragraph 3 of this Article:
(a) Article 10 It is understood that where the term “qualified governmental entity” means minimum holding period laid down in paragraph 3 of Article 10 was not met at the Government time of a Contracting Statethe payment of the dividend and, of a federal state (Land) thereof, or of any political subdivision or local authority thereofthere- fore, the Bank tax stipulated in paragraph 2 of JapanArticle 10 was withheld at the moment of the payment, and the Federal Bank condition of Germany (Deutsche Bundesbank) or the minimum holding period is met subsequent- ly, then the beneficial owner of the dividend shall be entitled to a person that is wholly owned, directly or indirectly, by refund of the Government tax withheld according to paragraph 2 of a Contracting State, of a federal state (Land) thereof, or of a political subdivision or local authority thereof;Article 10."
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Samples: Protocol Amending the Agreement for the Avoidance of Double Taxation
Entitlement to Benefits. 1. Except as otherwise provided in this Article, a resident of a Contracting State that derives income from the other Contracting State shall not be entitled to all a benefit that would otherwise be accorded under the benefits under this Agreement for a taxable year only if provisions of paragraph 3 of Article 12 unless such resident is a qualified person person, as defined in paragraph 2 and satisfies any other specified conditions in 2, at the relevant provisions of time when the Agreement for the obtaining of such benefitsbenefit would otherwise be accorded.
2. A resident of a Contracting State is shall be a qualified person for at a taxable year only if such time when a benefit would otherwise be accorded under the provisions of paragraph 3 of Article 12 if, at that time, the resident is eitheris:
(a) an individual;
(b) that Contracting State, a qualified governmental entitysubdivision or local authority thereof, the central bank of that Contracting State, or an agency or instrumentality of that Contracting State or subdivision or local authority;
(c) a companycompany or other entity, if its the principal class of its shares is listed or registered and is regularly traded on one or more recognised recognized stock exchanges;
(d) a pension fund or pension scheme, provided that, as of the end of the prior taxable year, more than 50 per cent of the beneficiaries, members or participants of that pension fund or pension scheme are individuals who are residents of either Contracting State;
(e) a person established under the laws of that Contracting State and operated exclusively for a religious, charitable, educational, scientific, artistic, cultural or public purpose, only if all or part of its income may be exempt from tax under the laws of that Contracting State; or
(fd) a person other than an individual, if if, at that time and on at least 65 per cent half of the voting shares or other beneficial interests days of the person a twelve month period that includes that time, persons that are owned, directly or indirectly, by residents of that Contracting State and that are qualified persons by reason of subparagraph (aunder subparagraph(a), (b), (c), (d) or (e).
3. Notwithstanding that a resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement in respect of an item of income derived from the other Contracting State if that resident satisfies any other specified conditions in the relevant provisions of the Agreement for the obtaining of such benefit and if:
(a) at least 65 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement, be entitled to equivalent or more favourable benefits; or
(b) at least 90 per cent of the voting shares or other beneficial interests of the person are owned, directly or indirectly, by persons who, if they had derived the item of income directly, would, under the Agreement or an agreement that the Contracting State from which the item of income arise has concluded with another State, be entitled to equivalent or more favourable benefits.
4. Where the provisions of subparagraph (f) of paragraph 2 or paragraph 3 apply:
(a) in respect of taxation by withholding at source, a resident of a Contracting State shall be considered to satisfy the conditions described in that subparagraph or that paragraph for the taxable year in which payment of an item of income is made if such resident satisfies those conditions during the twelve month period preceding the date of the payment (or, in the case of dividends, the date on which entitlement to the dividends is determined);
(b) in all other cases, a resident of a Contracting State shall be considered to satisfy the conditions described in that subparagraph or that paragraph for a taxable year if such resident satisfies those conditions on at least half the days of the taxable year.
(a) Notwithstanding that a resident of a Contracting State may not be a qualified person, that resident shall be entitled to a benefit under this Agreement in respect of an item of income derived from the other Contracting State if:
(i) that resident is engaged in the active conduct of a business (other than the business of making or managing investments for that resident’s own account, unless the business is banking, insurance or securities business carried on by a bank, insurance company or securities dealer) in the first- mentioned Contracting State;
(ii) the income derived from that other Contracting State is derived in connection with, or is incidental to, that business; and
(iii) that resident satisfies any other specified conditions in the relevant provisions of the Agreement for the obtaining of such benefit.
(b) If a resident of a Contracting State derives an item of income from a business carried on by that resident in the other Contracting State or derives an item of income arising in the other Contracting State from a person that has with that resident a relationship described in subparagraph (a) or (b) of paragraph 1 of Article 9, the conditions described in subparagraph (a) of this paragraph shall be considered to be satisfied with respect to such item of income only if the business carried on in the first- mentioned Contracting State is substantial in relation to the business carried on in that other Contracting State. Whether such business is substantial for the purpose of this paragraph shall be determined on the basis of all the facts and circumstances.
(c) In determining whether a person is engaged in the active conduct of a business in a Contracting State under subparagraph (a), the business conducted by a partnership in which that person is a partner, and the business conducted by a person connected to such person only to the extent that both persons are engaged in the same or complementary lines of business, shall be deemed to be conducted by such person. A person shall be connected to another if one ownsown, directly or indirectly, at least 50 per cent of the beneficial interests in the other (or, in the case of a company, at least 50 per cent of the voting shares of the company) or another person owns, directly or indirectly, at least 50 per cent of the beneficial interests (or, in the case of a company, at least 50 per cent of the voting shares of the company) in each person. In any case, a person shall be considered to be connected to another if, on the basis of all the facts and circumstances, one has control of the other or both are under the control of the same person or persons.
63. A If a resident of a Contracting State that is neither not a qualified person nor entitled under paragraph 3 or 5 to the benefits referred to in those paragraphs shall, nevertheless, be granted all the benefits under this Agreement or a benefit under the Agreement in respect of an item of income derived from the other Contracting State if, upon request from that residentperson, the competent authority of that other the Contracting State determinesin which a benefit is denied under the preceding paragraphs of this Article may, nevertheless, grant a benefit that would otherwise be accorded under the provisions of paragraph 3 of Article 12 with respect to an item of income described in accordance with that paragraph, taking into account the object and purpose of this Convention, but only if such resident demonstrates to the satisfaction of such competent authority that neither its domestic law or administrative practice, that the establishment, acquisition or maintenance of such resident and maintenance, nor the conduct of its operations are considered operations, had as not having one of its principal purposes the obtaining of such benefits as one of the principal purposesbenefit. The competent authority of the Contracting State to which a request has been made under this paragraph by a resident of the other Contracting State will shall consult with the competent authority of that other Contracting State before rejecting either granting or denying the request.
74. For the purposes of this Article:
(a) the term “qualified governmental entity” "principal class of shares" means the Government class or classes of shares of a company or entity which represents the majority of the aggregate vote and value of the company or entity;
(b) with respect to entities that are not companies, the term "shares" means interests that are comparable to shares; and
(c) the term "recognised stock exchange" means:
(i) any stock exchange established and regulated as such under the laws of either Contracting State; and
(ii) any other stock exchange agreed upon by the competent authorities of the Contracting States.
5. Notwithstanding the other provisions of this Convention, a benefit under the Convention shall not be granted in respect of a federal state (Land) thereofan item of income if it is reasonable to conclude, or having regard to all relevant facts and circumstances, that obtaining that benefit was one of the principal purposes of any political subdivision arrangement or local authority thereof, the Bank of Japan, the Federal Bank of Germany (Deutsche Bundesbank) or a person transaction that is wholly owned, resulted directly or indirectlyindirectly in that benefit, by unless it is established that granting that benefit in these circumstances would be in accordance with the Government object and purpose of a Contracting State, the relevant provisions of a federal state (Land) thereof, or of a political subdivision or local authority thereof;the Convention.
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