Withholding on cross-border interest: source state may tax but reduced rate applies when beneficial owner is resident elsewhere. Interest paid to a resident of the other Contracting State may be taxed in the recipient's State; the source State may also tax such interest but, if the beneficial owner is resident of the other State, the tax charged in the source State is limited. Interest is exempt in the source State when beneficially owned by the Government, political subdivisions, or the specified central banks. Interest connected with a permanent establishment or fixed base is taxable under business profits or independent personal services rules, and amounts in excess of arm's length interest remain taxable under domestic law.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Withholding on cross-border interest: source state may tax but reduced rate applies when beneficial owner is resident elsewhere.
Interest paid to a resident of the other Contracting State may be taxed in the recipient's State; the source State may also tax such interest but, if the beneficial owner is resident of the other State, the tax charged in the source State is limited. Interest is exempt in the source State when beneficially owned by the Government, political subdivisions, or the specified central banks. Interest connected with a permanent establishment or fixed base is taxable under business profits or independent personal services rules, and amounts in excess of arm's length interest remain taxable under domestic law.
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