Except as provided in paragraphs 2 and 3 of
this Article, the term "resident of a Contracting State" means, for
the purposes of this Convention, any person who, under the laws of
that State, is liable to tax therein by reason of his domicile,
residence, citizenship, place of management, place of
incorporation, or any other criterion of a similar nature. This
term, however, does not include any person who is liable to tax in
that State in respect only of income from sources in that State or
of profits attributable to a permanent establishment in that
State.
An individual who is a United States citizen or
an alien admitted to the United States for permanent residence (a
"green card" holder) is a resident of the United States only if the
individual has a substantial presence, permanent home or habitual
abode in the United States and if that individual is not a resident
of a State other than the United Kingdom for the purposes of a
double taxation convention between that State and the United
Kingdom.
The term "resident of a Contracting State"
includes:
(a) a pension scheme;
(b) a plan, scheme, fund, trust, company or other
arrangement established in a Contracting State that is operated
exclusively to administer or provide employee benefits and that, by
reason of its nature as such, is generally exempt from income
taxation in that State;
(c) an organization that is established exclusively for
religious, charitable, scientific, artistic, cultural, or
educational purposes and that is a resident of a Contracting State
according to its laws, notwithstanding that all or part of its
income or gains may be exempt from tax under the domestic law of
that State; and
(d) a qualified governmental entity that is, is a part of,
or is established in, that State.
Where by reason of the provisions of paragraph
1 of this Article, an individual is a resident of both Contracting
States, then his status shall be determined as follows:
(a) he shall be deemed to be a resident only of the 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 only of the State with which his personal and
economic relations are closer (centre of vital interests);
(b) if the State in which he has his centre of vital
interests cannot be determined, or if he does not have a permanent
home available to him in either State, he shall be deemed to be a
resident only of the State in which he has an habitual abode;
(c) if he has an habitual abode in both States or in neither
of them, he shall be deemed to be a resident only of the State of
which he is a national;
(d) if he is a national of both States or of neither of
them, the competent authorities of the Contracting States shall
endeavour to settle the question by mutual agreement.
Where by reason of the provisions of paragraph
1 of this Article a person other than an individual is a resident
of both Contracting States, the competent authorities of the
Contracting States shall endeavour to determine by mutual agreement
the mode of application of this Convention to that person. If the
competent authorities do not reach such an agreement, that person
shall not be entitled to claim any benefit provided by this
Convention, except those provided by paragraph 4 of Article 24
(Relief from Double Taxation), Article 25 (Non-discrimination) and
Article 26 (Mutual Agreement Procedure).
A marriage before January 1st, 1974 between a
woman who is a United States national and a man domiciled within
the United Kingdom shall be deemed to have taken place on January
1st, 1974 for the purpose of determining her domicile for United
Kingdom tax purposes, on or after the date on which this Convention
first has effect in relation to her.
