DT19930 - DT: USA: Double taxation
agreement, Article 1: General scope
- Except as specifically provided herein, this
Convention is applicable only to persons who are residents of one
or both of the Contracting States.
- This Convention shall not restrict in any
manner any benefit now or hereafter accorded:
(a) by the laws of either Contracting State; or
(b) by any other agreement between the Contracting
States.
- (a) Notwithstanding the provisions of
sub-paragraph b) of paragraph 2 of this Article:
(i) any question arising as to the interpretation or
application of this Convention and, in particular, whether a
taxation measure is within the scope of this Convention, shall be
determined exclusively in accordance with the provisions of Article
26 (Mutual Agreement Procedure) of this Convention; and
(ii) the provisions of Article II and Article XVII of the
General Agreement on Trade in Services shall not apply to a
taxation measure unless the competent authorities agree that the
measure is not within the scope of Article 25 (Non-discrimination)
of this Convention.
(b) For the purposes of this paragraph, a "measure" is a
law, regulation, rule, procedure, decision, administrative action,
or any similar provision or action.
- Notwithstanding any provision of this
Convention except paragraph 5 of this Article, a Contracting State
may tax its residents (as determined under Article 4 (Residence)),
and by reason of citizenship may tax its citizens, as if this
Convention had not come into effect.
- The provisions of paragraph 4 of this Article
shall not affect:
(a) the benefits conferred by a Contracting State under
paragraph 2 of Article 9 (Associated Enterprises), sub-paragraph b)
of paragraph 1 and paragraphs 3 and 5 of Article 17 (Pensions,
Social Security, Annuities, Alimony, and Child Support), paragraphs
1 and 5 of Article 18 (Pension Schemes) and Articles 24 (Relief
From Double Taxation), 25 (Non- discrimination), and 26 (Mutual
Agreement Procedure) of this Convention; and
(b) the benefits conferred by a Contracting State under
paragraph 2 of Article 18 (Pension Schemes) and Articles 19
(Government Service), 20 (Students), 20A (Teachers), and 28
(Diplomatic Agents and Consular Officers) of this Convention, upon
individuals who are neither citizens of, nor have been admitted for
permanent residence in, that State."
- A former citizen or long-term resident whose
loss of citizenship or long-term resident status had as one of its
principal purposes the avoidance of tax (as defined under the laws
of the Contracting State of which the person was a citizen or
long-term resident) shall be treated for the purposes of paragraph
4 of this Article as a citizen of that Contracting State but only
for a period of 10 years following the loss of such status. This
paragraph shall apply only in respect of income from sources within
that Contracting State (including income deemed under the domestic
law of that State to arise from such sources). Paragraph 4 of this
Article shall not apply in the case of any former citizen or
long-term resident of a Contracting State who ceased to be a
citizen or long-term resident of that State at any time before
February 6th, 1995.
- Where under any provision of this Convention
income or gains arising in one of the Contracting States are
relieved from tax in that Contracting State and, under the law in
force in the other Contracting State, a person, in respect of the
said income or gains, 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 of the income or
gains as is taxed in the other Contracting State.
- An item of income, profit or gain derived
through a person that is fiscally transparent under the laws of
either Contracting State shall be considered to be derived by a
resident of a Contracting State to the extent that the item is
treated for the purposes of the taxation law of such Contracting
State as the income, profit or gain of a resident.
( Further clarification to paragraphs 3, 6, and 8 may be found
at DT 19939V)
