Obsah (11)

Article 7Article 10Article 14Article 19Article 6Article 23Article 9Article 11Article 12Article 22Article 26

Saeima ir pieņēmusi un Valsts prezidents izsludina šādu likumu: Par Latvijas Republikas valdības un Lielbritānijas un Ziemeļīrijas Apvienotās Karalistes valdības konvenciju par nodokļu dubultās uzlikš

THE REPUBLIC

LATVIA AND THE GOVERNMENT

THE UNITED KINGDOM

GREAT BRITAIN AND NORTHERN IRELAND FOR THE AVOIDANCE

DOUBLE TAXATION AND THE PREVENTION

FISCAL EVASION WITH RESPECT TO TAXES ON INCOME AND ON CAPITAL GAINS The Government

the Republic

Latvia and the Government

the United Kingdom

Great Britain and Northern Ireland;Desiring to conclude a Convention for the avoidance

double taxation and the prevention

fiscal evasion with respect to taxes on income and on capital gains;Have agreed as follows:Article 1Personal scopeThis Convention shall apply to persons who are residents

one or both

the Contracting States.Article 2Taxes covered

a Contracting State or

its political subdivisions or local authorities, irrespective

the manner in which they are levied.

income including taxes on gains from the alienation

movable or immovable property.

the United Kingdom:(

1. i)the income tax;(
2. ii)the corporation tax; and(iii) the capital gains tax;(hereinafter referred to as "United Kingdom tax");(
3. b)in the case

Latvia:(

1. i)the enterprise income tax (uzņēmumu ienākuma nodoklis); and(
2. ii)the personal income tax (iedzīvotāju ienākuma nodoklis);(hereinafter referred to as "Latvian tax").

signature

this Convention in addition to, or in place

, the existing taxes. The competent authorities

the Contracting States shall notify each other

any substantial changes which have been made in their respective taxation laws.Article 3General definitions

this Convention, unless the context otherwise requires:(a) the term "United Kingdom" means Great Britain and Northern Ireland, including any area outside the territorial sea

the United Kingdom which in accordance with international law has been or may hereafter be designated, under the laws

the United Kingdom concerning the Continental Shelf, as an area within which the rights

the United Kingdom with respect to the sea bed and sub-soil and their natural resources may be exercised;(b) the term "Latvia" means the Republic

Latvia and, when used in the geographical sense, means the territory

the Republic

Latvia and any other area adjacent to the territorial waters

the Republic

Latvia within which, under the laws

Latvia and in accordance with international law, the rights

Latvia may be exercised with respect to the sea bed and its sub-soil and their natural resources;(

1. c)the term "national" means:(
2. i)in relation to the United Kingdom, any British citizen, or any British subject not possessing the citizenship

any other Commonwealth country or territory, provided he has the right

abode in the United Kingdom; and any legal person, partnership, association or other entity deriving its status as such from the law in force in the United Kingdom;(ii) in relation to Latvia, all individuals possessing the nationality

the Republic

Latvia; and any legal person, partnership or association deriving its status as such from the laws in force in the Republic

Latvia;(

1. d)the terms "a Contracting State" and "the other Contracting State" mean the United Kingdom or Latvia, as the context requires;(
2. e)the term "person" includes an individual, a company and any other body

persons, but subject to paragraph

this Article does not include a partnership;(

1. f)the term "company" means any body corporate or any entity which is treated as a body corporate for tax purposes;(
2. g)the terms "enterprise

a Contracting State" and "enterprise

the other Contracting State" mean respectively an enterprise carried on by a resident

a Contracting State and an enterprise carried on by a resident

the other Contracting State;(h) the term "international traffic" means any transport by a ship or aircraft operated by an enterprise

a Contracting State, except when the ship or aircraft is operated solely between places in the other Contracting State;(i) the term "competent authority" means:(i) in the case

the United Kingdom, the Commissioners

Inland Revenue or their authorised representative; and(ii) in the case

Latvia, the Minister

Finance or his authorised representative.

Latvia shall be treated as a person for the purposes

this Convention.

this Convention by a Contracting State any term not defined therein shall, unless the context otherwise requires, have the meaning which it has under the laws

that Contracting State concerning the taxes to which the Convention applies.Article 4Residence

this Convention, the term "resident

a Contracting State" means any person who, under the laws

that State, is liable to tax therein by reason

his domicile, residence, place

management, place

incorporation or any other criterion

a similar nature; the term does not include any person who is liable to tax in that Contracting State in respect only

income from sources in that State or capital situated therein.

the provisions

paragraph

this Article an individual is a resident

both Contracting States, then his status shall be determined in accordance with the following rules:(a) he shall be deemed to be a resident

the Contracting State in which he has a permanent home available to him; if he has a permanent home available to him in both Contracting States, he shall be deemed to be a resident

the Contracting State with which his personal and economic relations are closer (centre

vital interests);(b) if the Contracting State in which he has his centre

vital interests cannot be determined, or if he has not a permanent home available to him in either Contracting State, he shall be deemed to be a resident

the Contracting State in which he has an habitual abode;(c) if he has an habitual abode in both Contracting States or in neither

them, he shall be deemed to be a resident

the Contracting State

which he is a national;(d) if he is a national

both Contracting States or

neither

them, the competent authorities

the Contracting States shall settle the question by mutual agreement.

the provisions

paragraph

this Article a person other than an individual is a resident

both Contracting States, the competent authorities

the Contracting States shall endeavour to settle the question by mutual agreement. In the absence

such agreement, for the purpose

the Convention, the person shall not be entitled to claim any relief or exemption from tax provided by this Convention.Article 5Permanent establishment

this Convention, the term "permanent establishment" means a fixed place

business through which the business

an enterprise is wholly or partly carried on.

management;(

1. b)a branch;(
2. c)an

fice;(

1. d)a factory;(
2. e)a workshop; and(
3. f)a mine, an oil or gas well, a quarry or any other place

extraction

natural resources.

more than six months.

this Article, the term "permanent establishment" shall be deemed not to include:(a) the use

facilities solely for the purpose

storage, display or delivery

goods or merchandise belonging to the enterprise;(b) the maintenance

a stock

goods or merchandise belonging to the enterprise solely for the purpose

storage, display or delivery;(c) the maintenance

a stock

goods or merchandise belonging to the enterprise solely for the purpose

processing by another enterprise;(d) the maintenance

a fixed place

business solely for the purpose

purchasing goods or merchandise, or

collecting information, for the enterprise;(e) the maintenance

a fixed place

business solely for the purpose

carrying on, for the enterprise, any other activity

a preparatory or auxiliary character;(f) the maintenance

a fixed place

business solely for any combination

activities mentioned in sub-paragraphs (a) to (e)

this paragraph, provided that the overall activity

the fixed place

business resulting from this combination is

a preparatory or auxiliary character.

paragraphs

this Article, where a person - other than an agent

an independent status to whom paragraph

this Article applies - is acting on behalf

an enterprise and has, and habitually exercises, in a Contracting State an authority to conclude contracts in the name

the enterprise, that enterprise shall be deemed to have a permanent establishment in that Contracting State in respect

any activities which that person undertakes for the enterprise, unless the activities

such person are limited to those mentioned in paragraph

this Article which, if exercised through a fixed place

business, would not make this fixed place

business a permanent establishment under the provisions

that paragraph.

an independent status, provided that such persons are acting in the ordinary course

their business. However, when the activities

such an agent are devoted wholly or almost wholly on behalf

that enterprise, he will not be considered an agent

an independent status within the meaning

this paragraph.

a Contracting State controls or is controlled by a company which is a resident

the other Contracting State, or which carries on business in that other State (whether through a permanent establishment or otherwise), shall not

itself constitute either company a permanent establishment

the other.Article 6Income from immovable property

a Contracting State from immovable property (including income from agriculture or forestry) situated in the other Contracting State may be taxed in that other State.

the Contracting State in which the property in question is situated. The term shall in any case include property accessory to immovable property, in particular buildings, livestock and equipment used in agriculture and forestry, rights to which the provisions

general law respecting landed property apply, in particular any options or similar right to acquire immovable property, usufruct

immovable property and rights to variable or fixed payments as consideration for the working

, or the right to work, mineral deposits, sources and other natural resources; ships and aircraft shall not be regarded as immovable property.

paragraph

this Article shall apply to income derived from the direct use, letting, or use in any other form

immovable property.

shares or other corporate rights in a company entitles the owner

such shares or corporate rights to the enjoyment

immovable property held by the company, the income from the direct use, letting, or use in any other form

such right to enjoyment may be taxed in the Contracting State in which the immovable property is situated.

paragraphs

this Article shall also apply to the income from immovable property

an enterprise and to income from immovable property used for the performance

independent personal services.Article 7Business profits

an enterprise

a Contracting State shall be taxable only in that State unless the enterprise carries on business in the other Contracting State through a permanent establishment situated therein. If the enterprise carries on business as aforesaid, the profits

the enterprise may be taxed in the other State but only so much

them as is attributable to that permanent establishment.

paragraph

this Article, where an enterprise

a Contracting State carries on business in the other Contracting State through a permanent establishment situated therein, there shall in each Contracting State be attributed to that permanent establishment the profits which it might be expected to make if it were a distinct and separate enterprise engaged in the same or similar activities under the same or similar conditions and dealing wholly independently with the enterprise

which it is a permanent establishment.

a permanent establishment, there shall be allowed as deductions expenses which are incurred for the purposes

the permanent establishment, including executive and general administrative expenses so incurred, whether in the Contracting State in which the permanent establishment is situated or elsewhere.

the mere purchase by that permanent establishment

goods or merchandise for the enterprise.

the preceding paragraphs, the profits to be attributed to the permanent establishment shall be determined by the same method year by year unless there is good and sufficient reason to the contrary.

income or capital gains which are dealt with separately in other Articles

this Convention, then the provisions

those Articles shall not be affected by the provisions

this Article.Article 8Shipping and air transport

an enterprise

a Contracting State from the operation

ships or aircraft in international traffic shall be taxable only in that State.

this Article, profits

an enterprise from the operation

ships or aircraft in international traffic include:(a) profits from the rental on a bareboat basis

ships or aircraft; and(b) profits from the use, maintenance or rental

containers (including trailers and related equipment for the transport

containers) used for the transport

goods or merchandise;where such rental or such use, maintenance or rental, as the case may be, is incidental to the operation

ships or aircraft by the enterprise in international traffic.

paragraph

this Article shall also apply to profits from the participation in a pool, a joint business or an international operating agency, but only to so much

the profits so derived as is attributable to the participant in proportion to its share in the joint operation.Article 9Associated enterprises

a Contracting State participates directly or indirectly in the management, control or capital

an enterprise

the other Contracting State; or(b) the same persons participate directly or indirectly in the management, control or capital

an enterprise

a Contracting State and an enterprise

the other Contracting State;and in either case conditions are made or imposed between the two enterprises in their commercial or financial relations which differ from those which would be made between independent enterprises, then any profits which would, but for those conditions, have accrued to one

the enterprises, but, by reason

those conditions, have not so accrued, may be included in the profits

that enterprise and taxed accordingly.

an enterprise

that State - and taxes accordingly - profits on which an enterprise

the other Contracting State has been charged to tax in that other State and the profits so included are profits which would have accrued to the enterprise

the first-mentioned State if the conditions made between the two enterprises had been those which would have been made between independent enterprises, then that other State shall make an appropriate adjustment to the amount

the tax charged therein on those profits. In determining such adjustment, due regard shall be had to the other provisions

this Convention and the competent authorities

the Contracting States shall if necessary consult each other.Article 10Dividends

a Contracting State to a resident

the other Contracting State may be taxed in that other State.

which the company paying the dividends is a resident and according to the laws

that State, but if the recipient is the beneficial owner

the dividends the tax so charged shall not exceed:(a) 5 per cent

the gross amount

the dividends if the beneficial owner is a company which controls directly at least 25 per cent

the voting power in the company paying the dividends;(b) 15 per cent

the gross amount

the dividends in all other cases.This paragraph shall not affect the taxation

the company in respect

the profits out

which the dividends are paid.

the State

which the company making the distribution is a resident and also includes any other item which, under the laws

the Contracting State

which the company paying the dividend is a resident, is treated as a dividend or distribution

a company.

paragraphs

this Article shall not apply if the beneficial owner

the dividends, being a resident

a Contracting State, carries on business in the other Contracting State

which the company paying the dividends is a resident, through a permanent establishment situated therein, or performs in that other State independent personal services from a fixed base situated therein, and the holding in respect

which the dividends are paid is effectively connected with such permanent establishment or fixed base. In such case the provisions

Article 7

or Article 14

this Convention, as the case may be, shall apply.

a Contracting State derives profits or income from the other Contracting State, that other State may not impose any tax on the dividends paid by the company, except insofar as such dividends are paid to a resident

that other State or insofar as the holding in respect

which the dividends are paid is effectively connected with a permanent establishment or a fixed base situated in that other State, nor subject the company's undistributed profits to a tax on the company's undistributed profits, even if the dividends paid or the undistributed profits consist wholly or partly

profits or income arising in that other State.Article 11Interest

the other Contracting State may be taxed in that other State.

that State, but if the recipient is the beneficial owner

the interest the tax so charged shall not exceed 10 per cent

the gross amount

the interest.

paragraph

the other Contracting State shall be taxable only in that other State if such a resident is the beneficial owner

the interest and:(a) the payer or the recipient

the interest is the Government

a Contracting State, a political subdivision or a local authority thereof or an agency or instrumentality

that Government, political subdivision or local authority; or(b) the interest is paid in respect

a loan made, guaranteed or insured, or any other debt-claim or credit guaranteed or insured by the United Kingdom Export Credits Guarantee Department or by the state joint stock company "Latvian Exportcredit" (Latvijas eksportkredīts) or by any organisation established in either Contracting State after the date

signature

this Convention and which is

a similar nature (the competent authorities

the Contracting States shall by mutual agreement determine whether such organisations are

a similar nature); or(c) the interest is paid in respect

a loan made, guaranteed or insured by the Bank

England or the Bank

Latvia.

every kind, whether or not secured by mortgage, and in the case

the United Kingdom whether or not carrying a right to participate in the debtor's profits, and in particular, income from government securities and income from bonds or debentures, including premiums and prizes attaching to such securities, bonds or debentures. In the case

Latvia penalty charges for late payment shall not be regarded as interest for the purpose

this Article. The term interest shall not include any item which is treated as a distribution under the provisions

Article 10

this Convention.

paragraphs

this Article shall not apply if the beneficial owner

the interest, being a resident

a Contracting State, carries on business in the other Contracting State in which the interest arises, through a permanent establishment situated therein, or performs in that other State independent personal services from a fixed base situated therein, and the debt-claim in respect

which the interest is paid is effectively connected with such permanent establishment or fixed base. In such case the provisions

Article 7

or Article 14

this Convention, as the case may be, shall apply.

that State. Where, however, the person paying the interest, whether he is a resident

a Contracting State or not, has in a Contracting State a permanent establishment or a fixed base in connection with which the indebtedness on which the interest is paid was incurred, and such interest is borne by such permanent establishment or fixed base, then such interest shall be deemed to arise in the State in which the permanent establishment or fixed base is situated.

a special relationship between the payer and the beneficial owner or between both

them and some other person, the amount

the interest paid exceeds, for whatever reason, the amount which would have been agreed upon by the payer and the beneficial owner in the absence

such relationship, the provisions

this Article shall apply only to the last-mentioned amount

interest. In such case, the excess part

the payments shall remain taxable according to the laws

each Contracting State, due regard being had to the other provisions

this Convention.

this Article shall not apply if it was the main purpose or one

the main purposes

any person concerned with the creation or assignment

the debt-claim in respect

which the interest is paid to take advantage

this Article by means

that creation or assignment.Article 12Royalties

the other Contracting State may be taxed in that other State.

that State, but if the recipient is the beneficial owner

the royalties, the tax so charged shall not exceed:(a) 5 per cent

the gross amount

royalties that are for the use

industrial, commercial or scientific equipment;(b) 10 per cent

the gross amount

royalties other than those referred to in sub-paragraph (a).

any kind received as a consideration for the use

, or the right to use, any copyright

literary, artistic or scientific work (including cinematograph films, and films or tapes for television or radio broadcasting), any patent, trade mark, design or model, plan, secret formula or process, or for the use

, or the right to use, industrial, commercial, or scientific equipment, or for information (know-how) concerning industrial, commercial or scientific experience.

paragraphs

this Article shall not apply if the beneficial owner

royalties, being a resident

a Contracting State, carries on business in the other Contracting State in which the royalties arise, through a permanent establishment situated therein, or performs in that other State independent personal services from a fixed base situated therein, and the right or property in respect

which the royalties are paid is effectively connected with such permanent establishment or fixed base. In such case the provisions

Article 7

or Article 14

this Convention, as the case may be, shall apply.

that State. Where, however, the person paying the royalties, whether he is a resident

a Contracting State or not, has in a Contracting State a permanent establishment or a fixed base in connection with which the liability to pay the royalties was incurred, and such royalties are borne by such permanent establishment or fixed base, then such royalties shall be deemed to arise in the State in which the permanent establishment or fixed base is situated.

a special relationship between the payer and the beneficial owner or between both

them and some other person, the amount

the royalties paid exceeds, for whatever reason, the amount which would have been agreed upon by the payer and the beneficial owner in the absence

such relationship, the provisions

this Article shall apply only to the last-mentioned amount. In such case, the excess part

the payments shall remain taxable according to the laws

each Contracting State, due regard being had to the other provisions

this Convention.

this Article shall not apply if it was the main purpose or one

the main purposes

any person concerned with the creation or assignment

the rights in respect

which the royalties are paid to take advantage

this Article by means

that creation or assignment.Article 13Capital gains

a Contracting State from the alienation

immovable property referred to in Article 6

this Convention and situated in the other Contracting State may be taxed in that other State.

a Contracting State from the alienation

:(a) shares, other than shares quoted on an approved Stock Exchange, deriving their value or the greater part

their value directly or indirectly from immovable property situated in the other Contracting State, or(b) an interest in a partnership or trust the assets

which consist principally

immovable property situated in the other Contracting State, or

shares referred to in sub-paragraph (a) above, may be taxed in that other State.

movable property forming part

the business property

a permanent establishment which an enterprise

a Contracting State has in the other Contracting State or

movable property pertaining to a fixed base available to a resident

a Contracting State in the other Contracting State for the purpose

performing independent personal services, including such gains from the alienation

such a permanent establishment (alone or with the whole enterprise) or

such fixed base, may be taxed in that other State.

a Contracting State from the alienation

ships or aircraft operated in international traffic by that enterprise or movable property pertaining to the operation

such ships or aircraft, shall be taxable only in that Contracting State.

any property other than that referred to in paragraphs

this Article shall be taxable only in the Contracting State

which the alienator is a resident.

paragraph

this Article shall not affect the right

a Contracting State to levy according to its law a tax on capital gains from the alienation

any property derived by an individual who is a resident

the other Contracting State and has been a resident

the first-mentioned Contracting State at any time during the five years immediately preceding the alienation

the property.Article 14Independent personal services

a Contracting State in respect

professional services or other activities

an independent character shall be taxable only in that State unless he has a fixed base regularly available to him in the other Contracting State for the purpose

performing his activities. If he has a fixed base, the income may be taxed in the other State, but only so much

the income as is attributable to that fixed base. For this purpose, where a resident

a Contracting State is present in the other Contracting State for a period or periods exceeding in the aggregate 183 days in any twelve-month period commencing or ending in any fiscal year, he shall be deemed for that fiscal year to have a fixed base regularly available to him in that other State and the income that is derived from his activities referred to above that are performed in that other State shall be attributable to that deemed fixed base.

physicians, lawyers, engineers, architects, dentists and accountants.Article 15Dependent personal services

Articles 16, 18, 19, 20 and 21

this Convention, salaries, wages and other similar remuneration derived by a resident

a Contracting State in respect

an employment shall be taxable only in that State unless the employment is exercised in the other Contracting State. If the employment is so exercised, such remuneration as is derived therefrom may be taxed in that other State.

paragraph

this Article, remuneration derived by a resident

a Contracting State in respect

an employment exercised in the other Contracting State shall be taxable only in the first-mentioned State if:(

1. a)the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in any twelve-month period commencing or ending in the fiscal year concerned, and(
2. b)the remuneration is paid by, or on behalf

, an employer who is not a resident

the other State, and(c) the remuneration is not borne by a permanent establishment or a fixed base which the employer has in the other State.

this Article, remuneration derived in respect

an employment exercised aboard a ship or aircraft operated in international traffic by an enterprise

a Contracting State may be taxed in that State.Article 16Directors' feesDirectors' fees and other similar payments derived by a resident

a Contracting State in his capacity as a member

the board

directors or any other similar organ

a company which is a resident

the other Contracting State may be taxed in that other State.Article 17Artistes and sportsmen

Article 14

and Article 15

this Convention, income derived by a resident

a Contracting State as an entertainer, such as a theatre, motion picture, radio or television artiste, or a musician, or as a sportsman, from his personal activities as such exercised in the other Contracting State, may be taxed in that other State.

personal activities exercised by an entertainer or a sportsman in his capacity as such accrues not to the entertainer or sportsman himself but to another person, that income may, notwithstanding the provisions

Articles 7, 14 and 15

this Convention, be taxed in the Contracting State in which the activities

the entertainer or sportsman are exercised.

paragraphs

the other Contracting State, or a political subdivision or local authority thereof. In such case, the income shall be taxable only in the Contracting State

which the entertainer or sportsman is a resident.Article 18Pensions

paragraph

Article 19

this Convention, pensions and other similar remuneration paid in consideration

past employment to a resident

a Contracting State and any annuity paid to such a resident shall be taxable only in that State.

time under an obligation to make the payments in return for adequate and full consideration in money or money's worth.Article 19Government Service

services rendered to that State, subdivision, authority, agency or entity shall be taxable only in that State.(b) Notwithstanding the provisions

sub-paragraph (a)

this paragraph, such remuneration shall be taxable only in the other Contracting State if the services are rendered in that State and the individual is a resident

that State who:(i) is a national

that State; or(ii) did not become a resident

that State solely for the purpose

rendering the services.

funds created by, a Contracting State or a political subdivision or a local authority thereof or an agency thereof or an entity wholly owned by such State, subdivision or authority to an individual in respect

services rendered to that State, subdivision, authority, agency or entity shall be taxable only in that State.(b) Notwithstanding the provisions

sub-paragraph (a)

this paragraph, such pension shall be taxable only in the other Contracting State if the individual is a resident

and a national

that State.

Articles 15, 16 and 18

this Convention shall apply to remuneration and pensions in respect

services rendered in connection with a business carried on by a Contracting State or a political subdivision or a local authority thereof or an agency thereof or an entity wholly owned by such State, subdivision or authority.Article 20StudentsPayments which a student or an apprentice or trainee, who is or was immediately before visiting a Contracting State a resident

the other Contracting State and who is present in the first-mentioned State solely for the purpose

his education or training receives for the purpose

his maintenance, education or training shall not be taxed in the first-mentioned State, provided that such payments arise from sources outside that State.Article 21Professors and teachers

teaching or engaging in research at a university, college or other recognised educational institution in that Contracting State, and who is or was immediately before that visit a resident

the other Contracting State, shall not be taxed by the first-mentioned Contracting State on remuneration for such teaching or research for a period not exceeding two years from the date

his first visit to that State for such purpose.

some other private person or persons.Article 22Other income

income beneficially owned by a resident

a Contracting State, wherever arising, which are not dealt with in the foregoing Articles

this Convention, other than income paid out

trusts or the estates

deceased persons in the course

administration, shall be taxable only in that State.

paragraph

this Article shall not apply to income, other than income from immovable property as defined in paragraph

Article 6

this Convention, if the recipient

such income, being a resident

a Contracting State, carries on business in the other Contracting State through a permanent establishment situated therein, or performs in that other State independent personal services from a fixed base situated therein, and the right or property in respect

which the income is paid is effectively connected with such permanent establishment or fixed base. In such case the provisions

Article 7

or Article 14

this Convention, as the case may be, shall apply.

a special relationship between the person referred to in paragraph

them and some third person, the amount

the income referred to in paragraph

such a relationship, the provisions

this Article shall apply only to the last mentioned amount. In such a case, the excess part

the income shall remain taxable according to the laws

each Contracting State, due regard beeing had to the other applicable provisions

this Convention.

this Article shall not apply if it was the main purpose or one

the main purposes

any person concerned with the creation or assignment

the rights in respect

which the income is paid to take advantage

this Article by means

that creation or assignment.Article 23Elimination

double taxation

the law

the United Kingdom regarding the allowance as a credit against United Kingdom tax

tax payable in a territory outside the United Kingdom (which shall not affect the general principle hereof):(a) Latvian tax payable under the laws

Latvia and in accordance with this Convention, whether directly or by deduction, on profits, income or chargeable gains from sources within Latvia (excluding in the case

a dividend, tax payable in Latvia in respect

the profits out

which the dividend is paid) shall be allowed as a credit against any United Kingdom tax computed by reference to the same profits, income or chargeable gains by reference to which the Latvian tax is computed;(b) in the case

a dividend paid by a company which is a resident

Latvia to a company which is a resident

the United Kingdom and which controls directly or indirectly at least 10 per cent

the voting power in the company paying the dividend, the credit shall take into account (in addition to any Latvian tax for which credit may be allowed under the provisions

sub-paragraph (a)

this paragraph) the Latvian tax payable by the company in respect

the profits out

which such dividend is paid.

Latvia derives income or capital gains which, in accordance with this Convention, may be taxed in the United Kingdom, unless a more favourable treatment is provided in its domestic law, Latvia shall allow as a deduction from the tax on the income

that resident, an amount equal to the United Kingdom tax paid thereon in the United Kingdom.Such deduction shall not, however, exceed that part

Latvian tax as computed before the deduction is given, which is attributable to the income or capital gains which may be taxed in the United Kingdom.(b) For the purpose

sub-paragraph (a)

this paragraph, where a company that is a resident

Latvia receives a dividend from a company that is a resident

the United Kingdom in which it owns at least 10 per cent

shares having full voting rights, the tax paid in the United Kingdom shall include not only the tax paid on the dividend, but also the tax paid on the underlying profits

the company out

which the dividend was paid.

paragraphs

this Article, profits, income and capital gains owned by a resident

a Contracting State which may be taxed in the other Contracting State in accordance with this Convention, shall be deemed to arise from sources in that other Contracting State.Article 24Limitation

relief

this Convention any income is relieved from tax in a Contracting State and, under the law in force in the other Contracting State a person, in respect

that income, is subject to tax by reference to the amount thereof which is remitted to or received in that other Contracting State and not by reference to the full amount thereof, then the relief to be allowed under this Convention in the first-mentioned Contracting State shall apply only to so much

the income as is taxed in the other Contracting State.

any other Article

this Convention, a resident

a Contracting State who, as a consequence

domestic law concerning incentives to promote foreign investment, is not subject to tax or is subject to tax at a reduced rate in that Contracting State on income or capital gains, shall not receive the benefit

any reduction in or exemption from tax provided for in this Convention by the other Contracting State if the main purpose or one

the main purposes

such resident or person connected with such resident was to obtain the benefits

this Convention.Article 25PartnershipsWhere, under any provision

this Convention, a partnership is entitled, as a resident

Latvia, to exemption from tax in the United Kingdom on any income or capital gains, that provision shall not be construed as restricting the right

the United Kingdom to tax any member

the partnership who is a resident

the United Kingdom on his share

such income or capital gains; but any such income or capital gains shall be treated for the purposes

Article 23

this Convention as income or gains from sources in Latvia.Article 26Non-discrimination

a Contracting State shall not be subjected in the other Contracting State to any taxation or any requirement connected therewith, which is other or more burdensome than the taxation and connected requirements to which nationals

that other State in the same circumstances, in particular with respect to residence, are or may be subjected.

a Contracting State shall not be subjected in either Contracting State to any taxation or any requirement connected therewith, which is other or more burdensome than the taxation and connected requirements to which nationals

the State concerned in the same circumstances are or may be subjected.

a Contracting State has in the other Contracting State shall not be less favourably levied in that other State than the taxation levied on enterprises

that other State carrying on the same activities.

paragraph

Article 9, paragraphs

Article 11, paragraphs

Article 12or paragraphs

Article 22

this Convention apply, interest, royalties and other disbursements paid by an enterprise

a Contracting State to a resident

the other Contracting State shall, for the purpose

determining the taxable profits

such enterprise, be deductible under the same conditions as if they had been paid to a resident

the first-mentioned State.

a Contracting State, the capital

which is wholly or partly owned or controlled, directly or indirectly, by one or more residents

the other Contracting State, shall not be subjected in the first-mentioned State to any taxation or any requirement connected therewith which is other or more burdensome than the taxation and connected requirements to which other similar enterprises

the first-mentioned State are or may be subjected.

the personal allowances, relief and reductions for tax purposes which are granted to individuals so resident.

this Article shall apply to the taxes which are the subject

this Convention.Article 27Mutual agreement procedure

a Contracting State considers that the actions

one or both

the Contracting States result or will result for him in taxation not in accordance with the provisions

this Convention, he may, irrespective

the remedies provided by the domestic law

those States, present his case to the competent authority

the Contracting State

which he is a resident or, if his case comes under paragraph

Article 26

this Convention, to that

the Contracting State

which he is a national.

the other Contracting State, with a view to the avoidance

taxation which is not in accordance with the Convention.

the Contracting States shall endeavour to resolve by mutual agreement any difficulties or doubts arising as to the interpretation or application

the Convention.

the Contracting States may communicate with each other directly for the purpose

reaching an agreement in the sense

the preceding paragraphs.Article 28Exchange

information

the Contracting States shall exchange such information as is necessary for carrying out the provisions

this Convention or

the domestic laws

the Contracting States concerning taxes covered by this Convention insofar as the taxation thereunder is not contrary to this Convention, in particular, to prevent fraud and to facilitate the administration

statutory provisions against legal avoidance. The exchange

information is not restricted by Article 1. Any information received by a Contracting State shall be treated as secret and shall be disclosed only to persons or authorities (including courts and administrative bodies) involved in the assessment or collection

, the enforcement or prosecution in respect

, or the determination

appeals in relation to, the taxes covered by this Convention. Such persons or authorities shall use the information only for such purposes. They may disclose the information in public court proceedings or in judicial decisions.

paragraph

this Article be construed so as to impose on the competent authority

either Contracting State the obligation:(a) to carry out administrative measures at variance with the laws and administrative practice

that or

the other Contracting State;(b) to supply information which is not obtainable under the laws or in the normal course

the administration

that or

the other Contracting State;(c) to supply information which would disclose any trade, business, industrial, commercial or professional secret or trade process, or information the disclosure

which would be contrary to public policy.Article 29Members

diplomatic or permanent missions and consular postsNothing in this Convention shall affect the fiscal privileges accorded to members

diplomatic or permanent missions or consular posts under the general rules

international law or under the provisions

special agreements.Article 30Entry into forceThe Governments

each

the Contracting States shall notify to the other through the diplomatic channel the completion

the procedures required by law for the bringing into force

this Convention. This Convention shall enter into force on the date

the later

these notifications and shall thereupon have effect:(

1. a)in the United Kingdom:(
2. i)in respect

income tax and capital gains tax, for any year

assessment beginning on or after 6 April in the calendar year next following that in which the Convention enters into force;(ii) in respect

corporation tax, for any financial year beginning on or after 1 April in the calendar year next following that in which the Convention enters into force.(b) in Latvia:(i) in respect

taxes withheld at source, on income derived on or after the first day

January in the calendar year next following the year in which the Convention enters into force;(ii) in respect

other taxes on income, for taxes chargeable for any tax year beginning on or after the first day

January in the calendar year next following the year in which the Convention enters into force;Article 31TerminationThis Convention shall remain in force until terminated by one

the Contracting States. Either Contracting State may terminate the Convention, through diplomatic channels, by giving notice

termination at least six months before the end

any calendar year. In such event, the Convention shall cease to have effect:(a) in the United Kingdom:(i) in respect

income tax and capital gains tax, for any year

assessment beginning on or after 6 April in the calendar year next following that in which the notice is given;(ii) in respect

corporation tax, for any financial year beginning on or after 1 April in the calendar year next following that in which the notice is given.(b) in Latvia:(i) in respect

taxes withheld at source, on income derived on or after the first day

January in the calendar year next following the year in which the notice is given;(ii) in respect

other taxes on income for taxes chargeable for any tax year beginning on or after the first day

January in the calendar year next following the year in which the notice is given;In witness whereof the undersigned, duly authorised thereto, have signed this Convention.Done in duplicate at London this 8th day

May 1996, in the Latvian and the English languages, both texts being equally authentic. In the case

divergence

interpretation the English text shall prevail.For the GovernmentFor the Governmentof the Republic

Latviaof the United Kingdom

Great Britain and Northern IrelandEXCHANGE

NOTESHis ExcellencyMr Valdis BirkavsMinister for Foreign Affairs8 May 1996ExcellencyI have the honour to refer to the Convention between the Government

the United Kingdom

Great Britain and Northern Ireland and the Government

the Republic

Latvia for the Avoidance

Double Taxation and the Prevention

Fiscal Evasion with respect to Taxes on Income and Capital Gains which has been signed today and to make on behalf

the Government

the United Kingdom

Great Britain and Northern Ireland the following proposals for the purpose

applying:1. Article 2

the fact that the existing taxes as listed in the Convention are subject to a substantial programme

reform and wherever it is not possible to agree that a particular new tax satisfies the conditions

paragraph

both Contracting States and the competent authorities

the Contracting States endeavour to determine its status by mutual agreement, they shall have regard to such factors as the place

effective management, the place where it is incorporated or otherwise constituted and any other relevant factors.3. Article 5

paragraph

that enterprise, the Contracting States shall have regard to any relevant factors during any 12 month period commencing or ending in the fiscal year concerned. In particular if the relevant activities are devoted wholly or almost wholly on behalf

that enterprise for a period exceeding 9 months within that period

12 months, they will be considered to have been so devoted in that fiscal year.4. Article 6

immovable property situated in a Contracting State may be taxed in that Contracting State in accordance with Article 13

this Convention.5. Article 7

a permanent establishment, it is understood that expenses to be allowed as deductions by a Contracting State include only expenses that are deductible under the domestic laws

that State.6. Article 12Where, in any Convention for the avoidance

double taxation, signed after the date

signature

this Convention, between Latvia and a third State, which is a member

the Organisation for Economic Co-operation and Development at the date

signature

this Convention, Latvia agrees to a definition

royalties which excludes any rights or other property referred to in paragraph 3 or to exempt royalties arising in Latvia from Latvian tax on royalties or to lower rates

tax than those provided for in paragraph 2, such narrower definition, exemption, or lower rate shall automatically apply as if it had been specified in paragraph 3 or paragraph 2

Article 12

with effect from the date

entry into force

that Convention.7. Article 24

the Republic

Latvia, I have the honour to suggest that the present Note and Your Excellency's reply to that effect should be regarded as constituting an agreement between the two Governments in this matter, which shall enter into force at the same time as the entry into force

this Convention.I avail myself

this opportunity to extend to Your Excellency the assurance

my highest consideration.Sir Nicholas Bonsor Bt MPMinister

StateHis ExcellencySir Nicholas Bonsor Bt MpMinister

State Foreign and Commonwealth

fice8 May 1996Your ExcellencyI am in receipt

your note dated 8 May 1996 which states as follows:"His ExcellencyMr Valdis BirkavsMinister for Foreign AffairsYour Excellency I have the honour to refer to the Convention between the Government

the United Kingdom

Great Britain and Northern Ireland and the Government

the Republic

Latvia for the Avoidance

Double Taxation and the Prevention

Fiscal Evasion with respect to Taxes on Income and Capital Gains which has been signed today and to make on behalf

the Government

the United Kingdom the following proposals for the purpose

applying:1. Article 2

the fact that the existing taxes as listed in the Convention are subject to a substantial programme

reform and wherever it is not possible to agree that a particular new tax satisfies the conditions

paragraph

both Contracting States and the competent authorities

the Contracting States endeavour to determine its status by mutual agreement, they shall have regard to such factors as the place

effective management, the place where it is incorporated or otherwise constituted and any other relevant factors.3. Article 5

paragraph

that enterprise, the Contracting States shall have regard to any relevant factors during any 12 month period commencing or ending in the fiscal year concerned. In particular if the relevant activities are devoted wholly or almost wholly on behalf

that enterprise for a period exceeding 9 months within that period

12 months, they will be considered to have been so devoted in that fiscal year.4. Article 6

immovable property situated in a Contracting State may be taxed in that Contracting State in accordance with Article 13

this Convention.5. Article 7

a permanent establishment, it is understood that expenses to be allowed as deductions by a Contracting State include only expenses that are deductible under the domestic laws

that State.6. Article 12Where, in any Convention for the avoidance

double taxation, signed after the date

signature

this Convention, between Latvia and a third State, which is a member

the Organisation for Economic Co-operation and Development at the date

signature

this Convention, Latvia agrees to a definition

royalties which excludes any rights or other property referred to in paragraph 3 or to exempt royalties arising in Latvia from Latvian tax on royalties or to lower rates

tax than those provided for in paragraph 2, such narrower definition, exemption, or lower rate shall automatically apply as if it had been specified in paragraph 3 or paragraph 2

Article 12

with effect from the date

entry into force

that Convention.7. Article 24

the Republic

Latvia, I have the honour to suggest that the present Note and Your Excellency's reply to that effect should be regarded as constituting an agreement between the two Governments in this matter, which shall enter into force at the same time as the entry into force

the Convention.I avail myself

this opportunity to