DT2860.22 - DT: Azerbaijan: double taxation agreement, SI95 No 762, Article 22: Elimination of double taxation

1) Subject to the provisions of the law of the United Kingdom regarding the allowance as a credit against United Kingdom tax of tax payable in a territory outside the United Kingdom (which shall not affect the general principle hereof):

a) Azerbaijan tax payable under the laws of Azerbaijan and in accordance with this Convention, whether directly or by deduction, on profits, income or chargeable gains from sources within Azerbaijan (excluding in the case of a dividend, tax payable in respect of the profits out of 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 Azerbaijan tax is computed;
b) in the case of a dividend paid by a company which is a resident of Azerbaijan to a company which is a resident of the United Kingdom and which controls directly or indirectly at least 10 per cent of the voting power in the company paying the dividend, the credit shall take into account (in addition to any Azerbaijan tax for which credit may be allowed under the provisions of sub-paragraph (a) of this paragraph) the Azerbaijan tax payable by the company in respect of the profits out of which such dividend is paid.

2) Where a resident of Azerbaijan derives income or capital gains in the United Kingdom, which in accordance with the provisions of this Convention may be taxed in the United Kingdom, the tax paid on this income or capital gains in the United Kingdom shall be deducted from the tax collected from such person in connection with such income or capital gains in Azerbaijan. Such deduction, however, shall not exceed the amount of Azerbaijan tax on such income or capital gains, calculated in accordance with its legislation and regulations on taxation.

3) For the purposes of paragraphs (1) and (2) of this Article, profits, income and capital gains owned by a resident of 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.