GREAT BRITAIN AND NORTHERN IRELAND [ S.L.123.35 SUBSIDIARY LEGISLATION 123.35 DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND ORDER 27th March, 1995 LEGAL NOTICE 105
1995, as modified by S.L.123.183 *. 1. The title
this Order is Double Taxation Relief on Taxes on Income with the United Kingdom
Great Britain and Northern Ireland Order. 2. It is hereby declared (a) that the arrangements specified in the Convention set out in the Schedule to this Order have been made with the Government
the United Kingdom
Great Britain and Northern Ireland with a view to affording relief from double taxation in relation to the following taxes imposed by the laws
the United Kingdom
Great Britain and Northern Ireland: (
GREAT BRITAIN AND NORTHERN IRELAND SCHEDULE CONVENTION BETWEEN MALTA AND 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 CAPITAL GAINS The Government
Malta and the Government
the United Kingdom
Great Britain and Northern Ireland, desiring to conclude a new Convention for the avoidance
double taxation and the prevention
fiscal evasion with respect to taxes on income and capital gains, have agreed as follows: CHAPTER I Scope
the Convention ARTICLE 1 Personal Scope This Convention shall apply to persons who are residents
one or both
the Contracting States. ARTICLE 2 Taxes Covered
the United Kingdom: (
Malta: the income tax, (hereinafter referred to as "Malta tax").
signature
this Convention in addition to, or in place
, the existing taxes. The competent authorities
the Contracting States shall notify each other
any significant changes which have been made in their respective taxation laws.
this Article this Convention shall not apply to tax paid or payable in Malta in accordance with the provisions
subarticle
article 56
the Income Tax Act concerning the chargeable income
any person engaged in the production
petroleum produced in Malta or any substantially similar provision which is imposed after the date
signature
this Convention. DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND [ S.L.123.35 3 CHAPTER II Definitions ARTICLE 3 General 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 subsoil and their natural resources may be exercised; (b) the term "Malta", when used in a geographical sense, means the Island
Malta, the Island
Gozo and the other islands
the Maltese archipelago including the territorial waters thereof, and any area outside the territorial sea
Malta which, in accordance with international law, has been or may hereafter be designated, under the law
Malta concerning the Continental Shelf, as an area within which the rights
Malta with respect to the seabed and subsoil and their natural resources may be exercised; (
persons but does not include a partnership; (ii) in relation to Malta, also a company and any other body
persons; (
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; (
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 Malta, any citizen
Malta and any legal person, partnership, association or other entity deriving its status as such from the law in force in Malta; (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; [ S.L.123.35 4 DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND (ii) in the case
Malta, the Minister responsible for finance or his authorised representative.
this Convention by a Contracting State any term not otherwise defined shall, unless the context otherwise requires, have the meaning which it has under the laws
that State concerning the taxes to which this Convention applies. ARTICLE 4 Resident
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 or any other criterion
a similar nature. But this term does not include any person who is liable to tax in that State in respect only
income or capital gains from sources therein.
the provisions
paragraph
this Article an individual is a resident
both Contracting States, then his status shall be determined as follows: (a) he shall be deemed to be a resident solely
the Contracting State in which he has a permanent home available to him; if he has a permanent home available to him in both States, he shall be deemed to be a resident solely
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 no permanent home available to him in either Contracting State, he shall be deemed to be a resident solely
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 solely
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, then it shall be deemed to be a resident solely
the Contracting State in which its place
effective management is situated. ARTICLE 5 Permanent 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; (
fice; DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND [ S.L.123.35 5 (
natural resources; (g) a mine, an oil or gas well, a quarry or any other place
extraction
natural resources; (h) a building site or construction or assembly project or supervisory activities in connection therewith, where such site, project or activity continues for 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 on behalf
the enterprise, that enterprise shall be deemed to have a permanent establishment in that 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.
a Contracting State shall not be deemed to have a permanent establishment in the other Contracting State merely because it carries on business in that other State through a broker, general commission agent or any other agent
an independent status, where such persons are acting in the ordinary course
their business. However, if the activities
such an agent are carried out wholly or almost wholly for the enterprise (or for the enterprise and other enterprises which are controlled by it or have a controlling interest in it or are subject to the same common control) and the conditions made or imposed between them in their commercial or financial relations differ from those which would have been made or imposed if this had not been the case, that agent shall not be considered to be an agent
an independent status for the purposes
this paragraph.
a Contracting State controls or is controlled by a company which is a resident
the other Contracting State, or 6 [ S.L.123.35 DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND 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. CHAPTER III Taxation
Income ARTICLE 6 Income from Immovable Property
a Contracting State from immovable property (including income from agriculture and 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, livestock and equipment used in agriculture and forestry, rights to which the provisions
general law respecting immovable or landed property apply, usufruct
immovable property and rights to variable or fixed payments as consideration for the working
, or the right to work or to explore for, mineral deposits, sources and other natural resources; ships, boats 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.
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 7 Business 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 or with other enterprises which are controlled by the first-mentioned enterprise or have a controlling interest in it or are subject to the same common control.
the profits
a permanent establishment, there shall be allowed as deductions expenses
the enterprise, being expenses which are incurred for the purposes
the permanent establishment (including executive and general administrative expenses so incurred) and which would be deductible if the permanent establishment were an independent entity which paid those expenses, whether incurred in the Contracting State in which the permanent establishment is DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND [ S.L.123.35 7 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.
this Article shall not affect the application
the provisions
the law
a Contracting State regarding the taxation
profits from the business
insurance.
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 8 Shipping and Air Transport
a Contracting State from the operation
ships or aircraft in international traffic shall be taxable only in that State.
this Article, profits from the operation
ships or aircraft in international traffic include: (a) income 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 in international traffic.
this Article are derived by a resident
a Contracting State from participation in a pool, a joint business or an international operating agency, the profits attributable to that resident shall be taxable only in the Contracting State
which he is a resident. ARTICLE 9 Associated 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 by a Contracting State in the profits
that enterprise and taxed accordingly. [ S.L.123.35 8 DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND
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 that 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 10 Dividends
the United Kingdom to a resident
Malta may be taxed in Malta.
Malta and who receives a dividend from a company which is a resident
the United Kingdom, shall, subject to the provisions
this Article and provided that he is the beneficial owner
that dividend, be entitled: (a) to a tax credit in respect thereof
an amount equal to the tax credit to which an individual resident in the United Kingdom would have been entitled had he received that dividend (in this Article referred to as "the resident’s tax credit") less 15 per cent
the aggregate
the amount or value
that dividend and the amount
the resident’s tax credit, and (b) to payment
any amount by which the tax credit to which he is entitled by virtue
sub-paragraph (a) exceeds his liability to tax in the United Kingdom.
Malta to a resident
the United Kingdom may be taxed in the United Kingdom. Such dividends may also be taxed in Malta and according to the laws
Malta, but if the recipient is the beneficial owner
the dividends the tax so charged shall not exceed that chargeable on 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.
paragraph
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 a case the provisions
or Article 14
this Convention, as the case may be, shall apply.
a Contracting State derives profits DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND [ S.L.123.35 9 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 undistributed profits, even if the dividends paid or the undistributed profits consist wholly or partly
profits or income arising in that other State. ARTICLE 11 Interest
the other Contracting State may be taxed in that other State.
that State, but if the recipient is the beneficial owner
the interest and subject to tax in respect
the interest in the other Contracting State the tax so charged shall not exceed 10 per cent
the gross amount
the interest.
every kind, whether or not secured by mortgage and 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. The term "interest" shall not include any item which is treated as a distribution under the provisions
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
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 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 10 [ S.L.123.35 DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND Article by means
that creation or assignment.
paragraph
this Article, interest arising in a Contracting State shall be exempt from tax in that State if it is derived and beneficially owned by the Government
the other Contracting State or a local authority thereof or any agency or instrumentality
that Government or local authority.
this Convention and
paragraph
this Article, interest arising in a Contracting State which is paid to and beneficially owned by a resident
the other Contracting State shall be exempt from tax in the first-mentioned Contracting State if it is paid in respect
a loan made, guaranteed or insured, or any other debt-claim or credit guaranteed or insured by an institution beneficially owned by the Government
the Contracting State or any agency or instrumentality
that Government. ARTICLE 12 Royalties
the other Contracting State may be taxed in that other State.
that State, but if the recipient is the beneficial owner
the royalties and subject to tax in respect
the royalties in the State
which he is a resident, the tax so charged shall not exceed 10 per cent
the gross amount
the royalties.
, or the right to use, any copyright, patent, design or model, plan, secret formula or process, trademark or other like property or right; (b) the supply
scientific, technical, industrial or commercial knowledge or information (know-how); (c) the supply
any assistance in the State
which the payer
the royalties is resident that is ancillary and subsidiary to, and is furnished as a means
enabling the application or enjoyment
any such property or right as is mentioned in sub-paragraph (a), or any such knowledge or information as is mentioned in sub-paragraph (b); (d) total or partial forbearance in respect
the use or supply
any property or right referred to in this paragraph.
paragraphs
this Article shall not apply if the beneficial owner
the 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 Contracting 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
or Article 14
this Convention, as the case may be, shall apply.
that State. DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND [ S.L.123.35 11 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 fixed base in connection with which the obligation 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 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 13 Alienation
Property
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 income or 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 an enterprise
a Contracting State 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 provided that such income or gains are subject to tax in that Contracting State. 12 [ S.L.123.35 DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND
paragraph
this Article shall not affect the right
a Contracting State to levy according to its law a tax on income or 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 14 Independent Personal Services
a Contracting State in respect
professional services or activities
an independent character shall be taxable only in that State. However, such income may be taxed in the other Contracting State in the following circumstances: (a) if he has a fixed base regularly available to him in the other Contracting State for the purpose
performing his activities (in which case only so much
the income as is attributable to that fixed base may be taxed in that other Contracting State); or (b) if his stay in the other Contracting State is for a period or periods amounting to or exceeding in the aggregate 183 days during any calendar year.
physicians, lawyers, engineers, architects, dentists and accountants. ARTICLE 15 Dependent Personal Services
Articles 16, 18, and 19
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: (a) the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days within any period
twelve months; and (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 may be taxed in the Contracting State
which the enterprise operating the ship or aircraft is a resident. DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND [ S.L.123.35 13 ARTICLE 16 Directors’ Fees Directors’ fees and similar payments derived by a resident
one
the Contracting States in his capacity as a member
the board
directors, or other comparable body however described,
a company which is a resident
the other Contracting State may be taxed in that other State. ARTICLE 17 Artistes and Sportsmen
Articles 14 and 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. ARTICLE 18 Pensions
paragraph
this Convention, pensions and other similar remuneration paid in consideration
past employment, or any annuity paid, to an individual who is a resident
a Contracting State 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 19 Government Service
services rendered to that State or subdivision or authority shall be taxable only in that State. (b) However, 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 to an individual in respect
services rendered to that State or subdivision or authority shall be taxable only in 14 [ S.L.123.35 DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND that State. (b) However, 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 any business carried on by a Contracting State or a political subdivision or a local authority thereof. ARTICLE 20 Students and Trainees An individual who is or was a resident
a Contracting State immediately before making a visit to the other Contracting State and is present in the other State solely: (
a grant, allowance or award for the primary purpose
study, research or training from the Government
either State or from a scientific, educational, religious, or charitable organisation or under a technical assistance programme entered into by the Government
either State; shall be exempt from tax in that other State on: (i) all remittances from abroad for the purposes
his maintenance, education, study, research or training; and (ii) the amount
such grant, allowance or award. ARTICLE 21 Other Income
income
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, and which are subject to tax in that State 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
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
or Article 14
this Convention, as the case may be, shall apply.
this Article shall not apply if it was the main purpose or one
the main purposes
any person considered 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. CHAPTER IV DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND [ S.L.123.35 15 Elimination
Double Taxation ARTICLE 22 Elimination
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) Malta tax payable under the laws
Malta and in accordance with this Convention, whether directly or by deduction, on profits, income or chargeable gains from sources within Malta (excluding in the case
a dividend, tax payable 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 Malta tax is computed; (b) in the case
a dividend paid by a company which is a resident
Malta to a company which is 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 Malta tax for which credit may be allowed under the provisions
sub-paragraph (a)
this paragraph) the Malta tax payable by the company in respect
the profits out
which such dividend is paid.
the law
Malta regarding the allowance as a credit against Malta tax
tax payable in a territory outside Malta, where, in accordance with the provisions
this Convention, there is included in a Malta assessment profits, income or chargeable gains from sources within the United Kingdom, the United Kingdom tax payable, whether directly or by deduction, in respect
those sources (excluding in the case
a dividend, tax payable in respect
the profits out
which the dividend is paid) shall be allowed as a credit against any Malta tax payable in respect
those profits, income or chargeable gains.
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 in that other Contracting State.
this Article, for the purposes
paragraph
this Article the term "Malta tax payable" shall be deemed to include any amount which would have been payable as Malta tax for any year but for a deduction allowed in computing taxable income, or an exemption or reduction
tax granted for that year or any part thereof, under any
the following provisions
Malta law: (a) the provisions
: (i) article 3 and, where a deduction is allowed in computing taxable income by way
investment allowance, article 4
the Aids to Industries Ordinance; (ii) articles 7, 8 and 9 (so far as it provides for exemption from tax on dividends paid out
the gains or profits, or part thereof,
a company which are relieved from income tax under the provisions
article 7), 19, 20, 23 and 36
the Industrial Development Act; 16 [ S.L.123.35 DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND so far as the provisions in question were in force on, and have not been modified since, the date
signature
this Convention, or have been modified only in minor respects so as not to affect their general character and provided always that the competent authority
Malta has certified that any such exemption from or reduction
Malta tax given under these articles has been granted in order to promote industrial, commercial, scientific, educational or other development in Malta and that the gains or profits
the company, or any part thereof, were not exempt from Malta tax for the year in question, or part thereof, under the provisions
Articles 4 or 5
the Industrial Development Act, and the competent authority
the United Kingdom has accepted that such exemption or reduction has been granted for such purpose; or (b) any other provision which may subsequently be enacted allowing a deduction in computing taxable income, or granting an exemption or reduction
tax, which is agreed by the competent authorities
the Contracting States to be
a substantially similar character to any
the provisions referred to in sub-paragraph (a)(i) or (ii)
this paragraph, so far as it has not been modified thereafter or has been modified only in minor respects so as not to affect its general character, and subject always to certification and acceptance having taken place as provided for under sub-paragraph (a)
this paragraph.
paragraph
this Article shall be given for a period
ten years only, beginning with the date on which this Convention entered into force.
this Article may be extended by agreement between the Contracting States. ARTICLE 23 Limitation
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 at 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.
this Convention shall not apply to persons entitled to any special tax benefit under: (a) a law
either one
the Contracting Sates which has been identified in an Exchange
Notes between the Contracting States; or (b) any substantially similar law subsequently enacted. ARTICLE 24 Partnerships
this Convention, a partnership is entitled, as a resident
Malta, 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 partner who is a resident
the United Kingdom on his DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND [ S.L.123.35 17 share
such income or capital gains; but any such income or gains shall be treated for the purposes
this Convention as income or gains from sources in Malta.
this Convention shall entitle a partnership which is a resident
Malta to a tax credit in respect
dividends paid to the partnership by a company which is a resident
the United Kingdom; but any partner who is a resident
Malta shall be treated for the purposes
the said Article 10 and
this paragraph as having been paid a dividend
an amount corresponding to his share
those dividends by the company which is a resident
the United Kingdom. CHAPTER V Special Provisions ARTICLE 25 Non-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 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
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
that firstmentioned State are or may be subjected.
the other Contracting State any personal allowances, reliefs and reductions for tax purposes on account
civil status, family responsibilities or any other personal circumstances which it grants to its own residents.
this Article shall apply to the taxes which are the subject
this Convention. ARTICLE 26 Mutual Agreement Procedure
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 18 [ S.L.123.35 DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND 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
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 r e s o l v e b y m u t u a l a g r e e m e n t a n y d i ff i c u l t i e s o r d o u b t s a r i s i n g a s t o t h e 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 27 Exchange
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 the Convention insofar as the taxation thereunder is not contrary to the Convention. Any information received by a Contracting State shall be treated as secret in the same manner as information obtained under the domestic laws
that State and shall he 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 the 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 a 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 28 Diplomatic and Consular
ficials Nothing in this Convention shall affect the fiscal privileges
diplomatic agents or consular
ficials under the general rules
international law or under the provisions
special agreements. DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND [ S.L.123.35 19 ARTICLE 29 Entry into Force
the Contracting States shall notify to the other through the diplomatic channel the completion
the procedures required by its 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: (
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 Malta: in respect
income tax, for any year
assessment beginning on or after the first day
January in the calendar year next following that in which the Convention enters into force.
Malta for the Avoidance
Double Taxation and the Prevention
Fiscal Evasion with respect to Taxes on Income as amended by the Agreement signed at Valletta on 29th November 1974 (hereinafter referred to as "the 1961 Arrangement") shall terminate and cease to be effective from the date upon which this Convention has effect in respect
the taxes to which this Convention applies in accordance with the provisions
paragraph
this Article.
the 1961 Arrangement would have afforded any greater relief from tax than is due under this Convention, any such provision as aforesaid shall continue to have effect: (a) in the United Kingdom, for any year
assessment, financial year, or chargeable period; and (b) in Malta, for any year
assessment beginning in either case, before the entry into force
this Convention. ARTICLE 30 Termination This Convention shall remain in force until terminated by one
the Contracting States. Either Contracting State may terminate the Convention, through the diplomatic channel, 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 Malta: 20 [ S.L.123.35 DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND in respect
income tax, for any year
assessment beginning on or after the first day
January in the calendar year next following that in which the notice is given. In witness whereof the undersigned, being duly authorised thereto by their respective Governments, have signed this Convention. DONE at London, this 12 day
May, 1994, in the English language. JOSEF BONNICI FOR THE GOVERNMENT
MALTA STEPHEN DORELL FOR THE GOVERNMENT
THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND [ S.L.123.35 21 EXCHANGE
NOTES London 12th May, 1994 Your Excellency I have the honour to refer to the Convention between the Government
the United Kingdom
Great Britain and Northern Ireland and the Government
Malta 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 propose on behalf
the Government
the United Kingdom
Great Britain and Northern Ireland that: (a) with reference to Articles 7 and 9, it is understood that nothing contained therein shall affect the application
any law
a Contracting State relating to the determination
the tax liability
a person, including the determination
such liability by the exercise
discretion or the making
an estimate by the competent authority
that State in cases in which, from the information available to the competent authority
that State, it is not possible or practicable to ascertain the profits to be attributed to a permanent establishment, provided that that law shall be applied, so far as the information available to the competent authority permits, consistently with the principles
the said two Articles; (b) with reference to paragraph
, it is understood that the relevant institution, agency or instrumentality shall in the case
the United Kingdom be the Export Credits Guarantee Department and shall in the case
Malta be the Export Credit Guarantee Company Ltd; (c) with reference to paragraph
, it is understood that at the request
one competent authority both Contracting States shall enter into discussions about extending the period referred to in paragraph
an agreement to extend that period being reached, there should be no discontinuity in the application
the Article; (d) with reference to paragraph
, the provisions
this Convention shall not apply: (i) to persons who are entitled to a special tax benefit under the Malta Financial Services Centre Act except for those persons who opt under article 41
the said Act to be subject to the normal provisions
the Income Tax Act; or (ii) to persons who and to the extent to which under the provisions
the Merchant Shipping Act are not subject to tax on the profits derived from the operation
ships in international traffic; or (iii) to persons entitled to any special tax benefit in respect
distributions by a trust subject to the provisions
the Trusts Act given that a trust as laid down in that Act is not vested with legal personality and therefore cannot benefit under the Convention in its own right; or (iv) to persons entitled to any special tax benefit under any substantially similar law subsequently enacted and which is agreed by the competent authorities
the Contracting States as included within the terms
paragraph
this 22 [ S.L.123.35 DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND Convention. If the foregoing proposals are acceptable to the Government
Malta, I have the honour to suggest that the present Note and Your Excellency’s reply to that effect shall 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. J.S. BUCK for the Secretary
State for Foreign and Commonwealth Affairs DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND [ S.L.123.35 23 Floriana 12th May, 1994 Your Excellency I have the honour to acknowledge receipt
Your Excellency’s Note
today which reads as follows: "I have the honour to refer to the Convention between the Government
the United Kingdom
Great Britain and Northern Ireland and the Government
Malta 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 propose on behalf
the Government
the United Kingdom
Great Britain and Northern Ireland that: (a) with reference to Articles 7 and 9, it is understood that nothing contained therein shall affect the application
any law
a Contracting State relating to the determination
the tax liability
a person, including the determination
such liability by the exercise
discretion or the making
an estimate by the competent authority
that State in cases in which, from the information available to the competent authority
that State, it is not possible or practicable to ascertain the profits to be attributed to a permanent establishment, provided that that law shall be applied, so far as the information available to the competent authority permits, consistently with the principles
the said two Articles; (b) with reference to paragraph
, it is understood that the relevant institution, agency or instrumentality shall in the case
the United Kingdom be the Export Credits Guarantee Department and shall in the case
Malta be the Export Credit Guarantee Company Ltd; (c) with reference to paragraph
, it is understood that at the request
one competent authority both Contracting States shall enter into discussions about extending the period referred to in paragraph
an agreement to extend that period being reached, there should be no discontinuity in the application
the Article; (d) with reference to paragraph
, the provisions
this Convention shall not apply: (i) to persons who are entitled to a special tax benefit under the Malta Financial Services Centre Act except for those persons who opt under article 41
the said Act to be subject to the normal provisions
the Income Tax Act; or (ii) to persons who and to the extent to which under the provisions
the Merchant Shipping Act are not subject to tax on the profits derived from the operation
ships in international traffic; or (iii) to persons entitled to any special tax benefit in respect
distributions by a trust subject to the provisions
the Trusts Act given that a trust as laid down in that Act is not vested with legal personality and therefore cannot benefit under the Convention in its own right; or (iv) to persons entitled to any special tax benefit under any substantially similar law subsequently enacted and which is agreed by the competent authorities
the Contracting States as included within the terms
paragraph
this 24 [ S.L.123.35 DOUBLE TAXATION RELIEF ON TAXES ON INCOME WITH THE UNITED KINGDOM
GREAT BRITAIN AND NORTHERN IRELAND Convention. If the foregoing proposals are acceptable to the Government
Malta, I have the honour to suggest that the present Note and Your Excellency’s reply to that effect shall 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". The foregoing proposals being acceptable to the Government
Malta, I have the honour to confirm that Your Excellency’s Note and this Reply shall be regarded as constituting an agreement between the two Governments in the 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. VINCENT GALEA Commissioner
Inland Revenue For the Government
Malta
AI explanation based on the official legal text. Indicative, not a substitute for legal advice.