Agreement
between
the Government of New Zealand
and
the Government of the Republic of Singapore for the Avoidance of
Double Taxation and the Prevention of Fiscal Evasion with Respect
to Taxes on Income
The Government of New Zealand and the Government of the Republic of
Singapore,
Desiring to conclude an Agreement for the avoidance of double taxation
and the prevention of fiscal evasion with respect to taxes on income,
Have agreed as follows:
Article 1
Persons Covered
This Agreement shall apply to persons who are residents of one or
both of the Contracting States.
Article 2
Taxes Covered
1. The existing taxes to which the Agreement shall apply are:
(a) In New Zealand: the income tax
(hereinafter referred to as "New Zealand tax");
(b) In Singapore: the income tax
(hereinafter referred to as "Singapore tax").
2. The Agreement shall apply also to any identical or substantially
similar taxes that are imposed after the date of signature of the Agreement
in addition to, or in place of, the existing taxes. The competent authorities
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of the Contracting States shall notify each other within a reasonable period
of time of any significant changes that have been made in their taxation
laws.
Article 3
General Definitions
1. For the purposes of this Agreement, unless the context otherwise
requires:
(a) the term "person" includes an individual, a company and any
other body of persons;
(b) the term "company" means any body corporate or any entity
that is treated as a body corporate for tax purposes;
(c) the term "enterprise" applies to the carrying on of any
business;
(d) the terms "enterprise of a Contracting State" and "enterprise
of the other Contracting State" mean respectively an
enterprise carried on by a resident of a Contracting State
and an enterprise carried on by a resident of the other
Contracting State;
(e) the term "international traffic" means any transport by a ship
or aircraft operated by an enterprise of a Contracting State,
except when the ship or aircraft is operated solely between
places in the other Contracting State;
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(f) the term "competent authority" means:
(i) in the case of New Zealand, the Commissioner of
Inland Revenue or an authorised representative;
(ii) in the case of Singapore, the Minister for Finance or
an authorised representative;
(g) the term "national", in relation to a Contracting State, means:
(i) any individual possessing the nationality or citizenship
of that Contracting State; and
(ii) any legal person, partnership or association deriving
its status as such from the laws in force in that
Contracting State;
(h) the term "business" includes the performance of professional
services and of other activities of an independent character;
(i) the terms "a Contracting State" and "the other Contracting
State" mean New Zealand or Singapore as the context
requires;
(j) the term "statutory body" means a body constituted by
statute and performing only non-commercial functions which
would otherwise be performed by the Government of a
Contracting State;
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(k) the term "recognised Stock Exchange" means:
(i) in the case of New Zealand, the securities markets
operated by the New Zealand Exchange Limited;
(ii) in the case of Singapore, the securities market
operated by the Singapore Exchange Limited,
Singapore Exchange Securities Trading Limited and
the Central Depository (Pte) Limited; and
(iii) any other stock exchange located in a Contracting
State that is agreed upon by the competent authorities
of the Contracting States;
(l) (i) the term "New Zealand" means the territory of New
Zealand but does not include Tokelau or the
Associated Self Governing States of the Cook Islands
and Niue; it also includes any area beyond the
territorial sea designated under New Zealand
legislation and in accordance with international law as
an area in which New Zealand may exercise
sovereign rights with respect to natural resources;
(ii) the term "Singapore" means the Republic of
Singapore and when used in a geographical sense,
the term "Singapore" includes the territorial waters of
Singapore and any area extending beyond the limits
of the territorial waters of Singapore, and the sea-bed
and subsoil of any such area, which has been or may
hereafter be designated under the laws of Singapore
and in accordance with international law as an area
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over which Singapore has sovereign rights for the
purposes of exploring and exploiting the natural
resources, whether living or non-living.
2. For the purposes of Articles 10, 11 and 12, a trustee subject to tax
in a Contracting State in respect of dividends, interest or royalties shall be
deemed to be the beneficial owner of that interest or those dividends or
royalties.
3. As regards the application of the Agreement at any time by a
Contracting State, any term not defined therein shall, unless the context
otherwise requires, have the meaning that it has at that time under the law
of that State for the purposes of the taxes to which the Agreement applies,
any meaning under the applicable tax laws of that State prevailing over a
meaning given to the term under other laws of that State.
Article 4
Resident
1. For the purposes of this Agreement, the term "resident of a
Contracting State" means any person who, under the laws of that State, is
liable to tax therein by reason of that person's domicile, residence, place
of management or any other criterion of a similar nature, and also includes
that State and any political subdivision, local authority or statutory body
thereof.
2. Where by reason of the provisions of paragraph 1 an individual is a
resident of both Contracting States, then the individual's status shall be
determined as follows:
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(a) the individual shall be deemed to be a resident only of the
State in which a permanent home is available to the
individual; if a permanent home is available to the individual
in both States, the individual shall be deemed to be a
resident only of the State with which the individual's personal
and economic relations are closer (centre of vital interests);
(b) if the State in which the individual's centre of vital interests
cannot be determined, or if a permanent home is not
available to the individual in either State, the individual shall
be deemed to be a resident only of the State in which the
individual has an habitual abode;
(c) if the individual has an habitual abode in both States or in
neither of them, the individual shall be deemed to be a
resident only of the State of which the individual is a national;
(d) in any other case, the competent authorities of the
Contracting States shall settle the question by mutual
agreement.
3. Where by reason of the provisions of paragraph 1 a person other
than an individual is a resident of both Contracting States, then it shall be
deemed to be a resident only of the State in which its place of effective
management is situated.
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Article 5
Permanent Establishment
1. For the purposes of this Agreement, the term "permanent
establishment" means a fixed place of business through which the
business of an enterprise is wholly or partly carried on.
2. The term "permanent establishment" includes especially:
(a) a place of management;
(b) a branch;
(c) an office;
(d) a factory;
(e) a workshop, and
(f) a mine, an oil or gas well, a quarry or any other place of
extraction of natural resources.
3. A building site, or a construction, installation or assembly project, or
supervisory activities in connection with that building site or construction,
installation or assembly project, constitutes a permanent establishment if it
lasts more than 12 months.
4. An enterprise shall be deemed to have a permanent establishment
in a Contracting State and to carry on business through that permanent
establishment if:
(a) (i) it carries on activities which consist of, or which
are connected with, the exploration or exploitation of natural
resources, including standing timber, situated in that State;
or
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(ii) the enterprise operates substantial equipment
in that State;
but only where the activities continue or the
substantial equipment is operated within the State for
a period or periods exceeding in the aggregate 183
days in any 12-month period commencing or ending
in the year of income concerned; or
(b) it furnishes services (including consultancy and
independent personal services), but only where
activities of that nature continue within the State for a
period or periods exceeding in the aggregate 183
days in any 12-month period commencing or ending
in the year of income concerned.
5. For the purposes of determining the duration of activities under
paragraphs 3 and 4, the period during which activities are carried on in a
Contracting State by an enterprise associated with another enterprise shall
be aggregated with the period during which activities are carried on by the
enterprise with which it is associated if the first-mentioned activities are
connected with the activities carried on in that State by the last-mentioned
enterprise, provided that any period during which two or more associated
enterprises are carrying on concurrent activities is counted only once. An
enterprise shall be deemed to be associated with another enterprise if one
is controlled directly or indirectly by the other, or if both are controlled
directly or indirectly by a third person or persons.
6. An enterprise shall not be deemed to have a "permanent
establishment" merely by reason of:
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(a) the use of facilities solely for the purpose of storage, display
or delivery of goods or merchandise belonging to the
enterprise;
(b) the maintenance of a stock of goods or merchandise
belonging to the enterprise solely for the purpose of storage,
display or delivery;
(c) the maintenance of a stock of goods or merchandise
belonging to the enterprise solely for the purpose of
processing by another enterprise;
(d) the maintenance of a fixed place of business solely for the
purpose of purchasing goods or merchandise or of collecting
information, for the enterprise;
(e) the maintenance of a fixed place of business solely for the
purpose of carrying on, for the enterprise, any other activity
of a preparatory or auxiliary character;
(f) the maintenance of a fixed place of business solely for any
combination of activities mentioned in sub-paragraphs (a) to
(e), provided that the overall activity of the fixed place of
business resulting from this combination is of a preparatory
or auxiliary character.
7. Notwithstanding the provisions of paragraphs 1 and 2, where a
person other than an agent of an independent status to whom paragraph
8 applies is acting on behalf of an enterprise; and
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(a) has, and habitually exercises, in a Contracting State an
authority to substantially negotiate or conclude contracts on
behalf of the enterprise; or
(b) manufactures or processes in the first-mentioned State for
the enterprise goods or merchandise belonging to the
enterprise,
that enterprise shall be deemed to have a permanent establishment in that
State in respect of any activities which that person undertakes for the
enterprise, unless the activities of such person are limited to those
mentioned in paragraph 6 and are, in relation to that enterprise, of a
preparatory or auxiliary character.
8. An enterprise shall not be deemed to have a permanent
establishment in a Contracting State merely because it carries on
business in that State through a broker, general commission agent or any
other agent of an independent status, provided that such persons are
acting in the ordinary course of their business.
9. The fact that a company which is a resident of a Contracting State
controls or is controlled by a company which is a resident of the other
Contracting State, or which carries on business in that other State
(whether through a permanent establishment or otherwise), shall not of
itself constitute either company a permanent establishment of the other.
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Article 6
Income from Immovable Property
1. Income derived by a resident of a Contracting State from
immovable property (including income from agriculture, forestry or fishing)
situated in the other Contracting State may be taxed in that other State.
2. The term "immovable property" shall have the meaning which it has
under the law of the Contracting State in which the property in question is
situated. The term shall in any case include any natural resources,
property accessory to immovable property, livestock and equipment used
in agriculture and forestry, rights to which the provisions of general law
respecting landed property apply, usufruct of immovable property, rights to
explore for or exploit natural resources or standing timber, and rights to
variable or fixed payments either as consideration for or in respect of the
exploitation of, or the right to explore for or exploit natural resources or
standing timber; ships and aircraft shall not be regarded as immovable
property.
3. The provisions of paragraph 1 shall apply to income derived from
the direct use, letting, or use in any other form of immovable property.
4. The provisions of paragraphs 1 and 3 shall also apply to the income
from immovable property of an enterprise.
Article 7
Business Profits
1. The profits of an enterprise of 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
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the enterprise carries on business as aforesaid, the profits of the
enterprise may be taxed in the other State but only so much of them as is
attributable to that permanent establishment.
2. Subject to the provisions of paragraph 3, where an enterprise of 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 of
which it is a permanent establishment.
3. In determining the profits of a permanent establishment, there shall
be allowed as deductions expenses which are incurred for the purposes of
the permanent establishment, including executive and general
administrative expenses so incurred, whether in the State in which the
permanent establishment is situated or elsewhere.
4. No profits shall be attributed to a permanent establishment by
reason of the mere purchase by that permanent establishment of goods or
merchandise for the enterprise.
5. For the purposes of 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.
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6. Where:
(a) a resident of a Contracting State beneficially owns, whether
directly or through one or more interposed trusts, a share of
the business profits of an enterprise carried on in the other
Contracting State by the trustee of a trust other than a trust
which is treated as a company for tax purposes; and
(c) in relation to that enterprise, that trustee would, in
accordance with the principles of Article 5, have a permanent
establishment in that other State,
the enterprise carried on by the trustee shall be deemed to be a business
carried on in the other State by that resident through a permanent
establishment situated in that other State and that share of business
profits shall be attributed to that permanent establishment.
7. Where profits include items of income which are dealt with
separately in other Articles of this Agreement, then the provisions of those
Articles shall not be affected by the provisions of this Article.
8. Notwithstanding the provisions of this Article, an enterprise of a
Contracting State that derives income or profits from any form of
insurance, other than life insurance, from the other Contracting State in
the form of premiums paid for the insurance of risks situated in that other
State, may to that extent be taxed in the other State in accordance with
the law of that other State relating specifically to the taxation of any person
who derives such income or profits. However, the amount of the income
or profits that may be taxed in that Contracting State shall not exceed 10
per cent of the gross premiums receivable, except where the income or
profits so derived are attributable to a permanent establishment of an
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enterprise of the first-mentioned State, in which case the other provisions
of this Article shall apply.
Article 8
Shipping and Air Transport
1. Profits derived by an enterprise of a Contracting State from the
operation of ships or aircraft in international traffic shall be taxable only in
that State.
2. Notwithstanding the provisions of paragraph 1, such profits may be
taxed in the other Contracting State to the extent the profits relate to
transport confined solely to places in that other State.
3. The provisions of paragraphs 1 and 2 shall also apply to profits
from the participation in a pool, a joint business or an international
operating agency.
4. For the purposes of this Article, profits from the operation of ships
or aircraft in international traffic shall include:
(a) profits from the rental on a bareboat basis of ships or aircraft;
and
(b) profits from the use, maintenance or rental of containers
(including trailers and related equipment for the transport of
containers), used for the transport of goods or merchandise;
where such rental or such use, maintenance or rental, as the case
may be, is incidental to the operation of ships or aircraft in
international traffic.
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5. For the purposes of this Article, profits derived from the carriage by
ships or aircraft of passengers, livestock, mail, goods or merchandise
which are shipped in a Contracting State for discharge at a place in that
State shall be treated as profits from transport confined solely to places in
that State.
Article 9
Associated Enterprises
1. Where
(a) an enterprise of a Contracting State participates directly or
indirectly in the management, control or capital of an
enterprise of the other Contracting State, or
(b) the same persons participate directly or indirectly in the
management, control or capital of an enterprise of a
Contracting State and an enterprise of 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 of the
enterprises, but, by reason of those conditions, have not so accrued, may
be included in the profits of that enterprise and taxed accordingly.
2. Where a Contracting State includes in the profits of an enterprise of
that State - and taxes accordingly - profits on which an enterprise of the
other Contracting State has been charged to tax in that other State and
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the profits so included are profits which would have accrued to the
enterprise of 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 of the tax charged therein on those profits. In
determining such adjustment, due regard shall be had to the other
provisions of this Agreement and the competent authorities of the
Contracting States shall if necessary consult each other.
Article 10
Dividends
1. Dividends paid by a company which is a resident of a Contracting
State to a resident of the other Contracting State may be taxed in that
other State.
2. However, such dividends may also be taxed in the Contracting
State of which the company paying the dividends is a resident and
according to the laws of that State, but if the beneficial owner of the
dividends is a resident of the other Contracting State, the tax so charged
shall not exceed:
(a) 5 per cent of the gross amount of the dividends if the
beneficial owner is a company that owns directly at least 10
per cent of the voting power of the company paying the
dividends;
(b) 15 per cent of the gross amount of the dividends in all other
cases.
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This paragraph shall not affect the taxation of the company in
respect of the profits out of which the dividends are paid.
3. The term "dividends" as used in this Article means income from
shares and other income treated as income from shares by the laws of the
State of which the company making the distribution is a resident.
4. The provisions of paragraphs 1 and 2 shall not apply if the
beneficial owner of the dividends, being a resident of a Contracting State,
carries on business in the other Contracting State of which the company
paying the dividends is a resident, through a permanent establishment
situated therein and the holding in respect of which the dividends are paid
is effectively connected with such permanent establishment. In such case
the provisions of Article 7 shall apply.
5. Where a company which is a resident of a Contracting State
derives profits 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 of that other State or
insofar as the holding in respect of which the dividends are paid is
effectively connected with a permanent establishment situated in that
other State, nor subject the company's undistributed profits to a tax on the
company's undistributed profits, even if the dividends paid or the
undistributed profits consist wholly or partly of profits or income arising in
such other State.
6. No relief shall be available under this Article if it was the main
purpose or one of the main purposes of any person concerned with an
assignment of the dividends, or with the creation or assignment of the
shares or other rights in respect of which the dividend is paid, or the
establishment, acquisition or maintenance of the company that is the
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beneficial owner of the dividends and the conduct of its operations, to take
advantage of this Article. In any case where a Contracting State intends
to apply this paragraph, the competent authority of that State shall consult
with the competent authority of the other Contracting State.
Article 11
Interest
1. Interest arising in a Contracting State and paid to a resident of the
other Contracting State may be taxed in that other State.
2. However, such interest may also be taxed in the Contracting State
in which it arises and according to the laws of that State, but if the
beneficial owner of the interest is a resident of the other Contracting State,
the tax so charged shall not exceed 10 per cent of the gross amount of the
interest.
3. Notwithstanding the provisions of paragraph 2, interest arising in a
Contracting State and paid to the Government of the other Contracting
State shall be exempt from tax in the first-mentioned State.
4. For the purpose of paragraph 3, the term "Government":
(a) in the case of New Zealand, means the Government of New
Zealand and shall include:
(i) the Reserve Bank of New Zealand;
(ii) the New Zealand Export Credit Office;
(iii) the New Zealand Superannuation Fund;
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(iv) a statutory body; and
(v) any institution wholly or mainly owned by the
Government of New Zealand as may be agreed from
time to time between the competent authorities of the
Contracting States;
(b) in the case of Singapore, means the Government of
Singapore and shall include:
(i) the Monetary Authority of Singapore;
(ii) the Government of Singapore Investment Corporation
Pte Ltd;
(iii) a statutory body; and
(iv) any institution wholly or mainly owned by the
Government of Singapore as may be agreed from
time to time between the competent authorities of the
Contracting States.
5. The term "interest" as used in this Article means income from debt-
claims of 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,
including premiums and prizes attaching to such securities, bonds or
debentures, as well as all other income treated as income from money lent
by the laws, relating to tax, of the Contracting State in which the income
arises, but does not include any income which is treated as a dividend
under Article 10.
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6. The provisions of paragraphs 1, 2 and 3 shall not apply if the
beneficial owner of the interest, being a resident of a Contracting State,
carries on business in the other Contracting State in which the interest
arises through a permanent establishment situated therein and the debt-
claim in respect of which the interest is paid is effectively connected with
such permanent establishment. In such case the provisions of Article 7
shall apply.
7. Interest shall be deemed to arise in a Contracting State when the
payer is a resident of that State. Where, however, the person paying the
interest, whether the person is a resident of a Contracting State or not, has
in a Contracting State a permanent establishment in connection with which
the indebtedness on which the interest is paid was incurred, and such
interest is borne by or deductible in determining the income, profits or
gains attributable to that permanent establishment, then such interest shall
be deemed to arise in the State in which the permanent establishment is
situated.
8. Where, by reason of a special relationship between the payer and
the beneficial owner or between both of them and some other person, the
amount of the interest, having regard to the debt-claim for which it is paid,
exceeds the amount which would have been agreed upon by the payer
and the beneficial owner in the absence of such relationship, the
provisions of this Article shall apply only to the last-mentioned amount. In
such case, the excess part of the payments shall remain taxable according
to the laws of each Contracting State, due regard being had to the other
provisions of this Agreement.
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Article 12
Royalties
1. Royalties arising in a Contracting State and paid to a resident of the
other Contracting State may be taxed in that other State.
2. However, such royalties may also be taxed in the Contracting State
in which they arise and according to the laws of that State, but if the
beneficial owner of the royalties is a resident of the other Contracting
State, the tax so charged shall not exceed 5 per cent of the gross amount
of the royalties.
3. The term "royalties" as used in this Article means payments of any
kind, whether periodical or not, and however described or computed, to
the extent to which they are made as consideration for:
(a) the use of, or the right to use, any copyright (including the
use of or the right to use any literary, dramatic, musical,
artistic, or scientific works, sound recordings, films,
broadcasts, cable programmes, typographical arrangements
of published editions or computer software), patent, design
or model, plan, secret formula or process, trade-mark, or
other like property or right; or
(b) the use of, or the right to use, any industrial, scientific or
commercial equipment; or
(c) knowledge or information concerning industrial, commercial
or scientific experience; or
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(d) any assistance that is ancillary and subsidiary to, and is
furnished as a means of enabling the application or
enjoyment of, any such property or right as is mentioned in
subparagraph (a), any such equipment as is mentioned in
subparagraph (b) or any such knowledge or information as is
mentioned in subparagraph (c); or
(e) total or partial forbearance in respect of the use or supply of
any property or right referred to in this paragraph.
4. The provisions of paragraphs 1 and 2 shall not apply if the
beneficial owner of the royalties, being a resident of a Contracting State,
carries on business in the other Contracting State in which the royalties
arise through a permanent establishment situated therein and the right or
property in respect of which the royalties are paid is effectively connected
with such permanent establishment. In such case the provisions of Article
7 shall apply.
5. Royalties shall be deemed to arise in a Contracting State when the
payer is a person who is a resident of that State. Where, however, the
person paying the royalties, whether the person is a resident of a
Contracting State or not, has in a Contracting State a permanent
establishment in connection with which the liability to pay the royalties was
incurred, and the royalties are borne by or deductible in determining the
income, profits or gains attributable to that permanent establishment, then
the royalties shall be deemed to arise in the State in which the permanent
establishment is situated.
6. Where, by reason of a special relationship between the payer and
the beneficial owner or between both of them and some other person, the
amount of the royalties, having regard to the use, right or information for
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which they are paid, exceeds the amount which would have been agreed
upon by the payer and the beneficial owner in the absence of such
relationship, the provisions of this Article shall apply only to the last-
mentioned amount. In such case, the excess part of the payments shall
remain taxable according to the laws of each Contracting State, due
regard being had to the other provisions of this Agreement.
7. No relief shall be available under this Article if it was the main
purpose or one of the main purposes of any person concerned with an
assignment of the royalties, or with the creation or assignment of the rights
in respect of which the royalties are paid or credited, to take advantage of
this Article by means of that creation or assignment. In any case where a
Contracting State intends to apply this paragraph, the competent authority
of that State shall consult with the competent authority of the other
Contracting State.
Article 13
Alienation of Property
1. Gains derived by a resident of a Contracting State from the
alienation of immovable property referred to in Article 6 and situated in the
other Contracting State may be taxed in that other State.
2. Gains from the alienation of movable property forming part of the
business property of a permanent establishment which an enterprise of a
Contracting State has in the other Contracting State, including such gains
from the alienation of such a permanent establishment (alone or with the
whole enterprise), may be taxed in that other State.
3. Gains from the alienation of ships or aircraft operated in
international traffic, or movable property pertaining to the operation of such
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ships or aircraft, shall be taxable only in the Contracting State in which the
enterprise alienating such ships, aircraft or other property is a resident.
4. Gains derived by a resident of a Contracting State from the
alienation of shares, other than shares traded on a recognised Stock
Exchange, deriving more than 50 per cent of their value directly or
indirectly from immovable property situated in the other Contracting State
may be taxed in that other State.
5. Nothing in this Agreement affects the application of the laws of a
Contracting State relating to the taxation of gains of a capital nature
derived from the alienation of any property other than that to which any of
the preceding paragraphs of this Article apply.
Article 14
Income from Employment
1. Subject to the provisions of Articles 15, 17 and 18, salaries, wages
and other similar remuneration derived by a resident of a Contracting
State in respect of 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.
2. Notwithstanding the provisions of paragraph 1, remuneration
derived by a resident of a Contracting State in respect of 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 in any
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twelve month period commencing or ending in the year of
income concerned, and
(b) the remuneration is paid by, or on behalf of, an employer
who is not a resident of the other State, and
(c) the remuneration is not borne by or not deductible in
determining the taxable profits of a permanent establishment
which the employer has in the other State.
3. Notwithstanding the preceding provisions of this Article,
remuneration derived in respect of an employment exercised aboard a
ship or aircraft operated in international traffic by an enterprise of a
Contracting State shall be taxable only in that State. However, if the
remuneration is derived by a resident of the other Contracting State, it may
also be taxed in that other State.
Article 15
Directors' Fees
Directors' fees and other similar payments derived by a resident of
a Contracting State in that person's capacity as a member of the board of
directors of a company which is a resident of the other Contracting State
may be taxed in that other State.
Article 16
Entertainers and Sportspersons
1. Notwithstanding the provisions of Articles 7 and 14, income derived
by a resident of a Contracting State as an entertainer, such as a theatre,
motion picture, radio or television artiste, or a musician, or as a
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sportsperson, from that person's personal activities as such exercised in
the other Contracting State, may be taxed in that other State.
2. Where income in respect of personal activities exercised by an
entertainer or a sportsperson in that person's capacity as such accrues not
to the entertainer or sportsperson but to another person, that income may,
notwithstanding the provisions of Articles 7 and 14, be taxed in the
Contracting State in which the activities of the entertainer or sportsperson
are exercised.
3. The provisions of paragraphs 1 and 2 shall not apply to income
derived from activities exercised in a Contracting State by an entertainer
or a sportsperson if the visit to that State is wholly or mainly supported by
public funds of one or both of the Contracting States or political
subdivisions or local authorities or statutory bodies thereof. In such case,
the income shall be taxable only in the Contracting State in which the
entertainer or the sportsperson is a resident.
Article 17
Pensions
1. Subject to the provisions of paragraph 2 of Article 18, pensions and
other similar remuneration paid to a resident of a Contracting State in
consideration of past employment shall be taxable only in that State.
2. Pensions and other payments made under the social security
legislation of a Contracting State to a resident of the other Contracting
State shall be taxable only in that other State.
27
Article 18
Government Service
1. (a) Salaries, wages and other similar remuneration paid by a
Contracting State or a political subdivision or a local authority
or a statutory body thereof to an individual in respect of
services rendered to that State or subdivision or authority or
body shall be taxable only in that State.
(b) However, such salaries, wages and other similar
remuneration shall be taxable only in the other Contracting
State if the services are rendered in that State and the
individual is a resident of that State who:
(i) is a national of that State; or
(ii) did not become a resident of that State solely for the
purpose of rendering the services.
2. (a) Notwithstanding the provisions of paragraph 1, any pensions
and other similar remuneration paid by, or out of funds
created by, one of the Contracting States or a political
subdivision or a local authority or a statutory body thereof to
an individual in respect of services rendered to that State or
subdivision or authority or body may be taxed in that State.
(b) However, such pensions and other similar remuneration
shall be taxable only in the Contracting State of which the
individual is a resident if the individual is a national of that
State.
28
3. The provisions of Articles 14, 15, 16, and 17 shall apply to salaries,
wages, and other similar remuneration, and to pensions, in respect of
services rendered in connection with a business carried on by a
Contracting State or a political subdivision or a local authority or a
statutory body thereof.
Article 19
Students
Payments which a student or business apprentice who is or was
immediately before visiting a Contracting State a resident of the other
Contracting State and who is present in the first-mentioned State solely for
the purpose of the student's or business apprentice's education or training
receives for the purpose of the student's or business apprentice's
maintenance, education or training shall not be taxed in that State,
provided that such payments arise from sources outside that State.
Article 20
Other Income
Items of income of a resident of a Contracting State, wherever
arising, not dealt with in the foregoing Articles of this Agreement shall be
taxable only in that State except that if such income is derived from
sources within the other Contracting State, that income may also be taxed
in that other State.
Article 21
Elimination of Double Taxation
1. Subject to any provisions of the laws of New Zealand which may
from time to time be in force which relate to the allowance of a credit
29
against New Zealand tax of tax paid in a country outside New Zealand
(which shall not affect the general principle of this Article), Singapore tax
paid under the laws of Singapore and consistent with this Agreement,
whether directly or by deduction, in respect of income derived by a
resident of New Zealand from sources in Singapore (excluding, in the case
of a dividend, tax paid in respect of the profits out of which the dividend is
paid) shall be allowed as a credit against New Zealand tax payable in
respect of that income.
2. Subject to any provisions of the laws of Singapore which may from
time to time be in force and which relate to the allowance of a credit
against Singapore tax of tax paid in a country outside Singapore (which
shall not affect the general principles hereof), New Zealand tax paid under
the law of New Zealand and in accordance with this Agreement, whether
directly or by deduction, in respect of income derived by a Singapore
resident from sources in New Zealand (excluding, in the case of a
dividend, tax paid in respect of profits out of which the dividend is paid)
shall be allowed as a credit against Singapore tax payable in respect of
that income. However, where such income is a dividend paid by a
company which is a New Zealand resident to a company which is a
Singapore resident and which beneficially owns at least 10% of the paid-
up share capital in the first-mentioned company the credit shall take into
account (in addition to any New Zealand tax on dividends) the New
Zealand tax paid by the first-mentioned company in respect of its profits.
3. For the purposes of paragraph 1 of this Article, a New Zealand
resident deriving income from sources in Singapore consisting of -
(a) profits, being profits in respect of which an exemption from
Singapore tax has been granted under the provisions of the
30
Economic Expansion Incentives (Relief from Income Tax)
Act, (Chapter 86) of Singapore; or
(b) interest or royalties, being interest or royalties in respect of
which an exemption from or reduction of Singapore tax has
been granted under the provisions of the said Economic
Expansion Incentives (Relief from Income Tax) Act, (Chapter
86) -
shall be deemed to have paid Singapore tax in an amount or, as the case
may be, the Singapore tax paid shall be deemed to have been increased
by an amount equal to the amount by which the Singapore tax that
otherwise would have been payable under the law of Singapore and in
accordance with this Agreement in respect of those profits or, as the case
may be, that interest or those royalties is reduced by the exemption or
reduction granted.
4. Every reference in paragraph 3 to the Economic Expansion
Incentives (Relief from Income Tax) Act, (Chapter 86) shall be deemed to
include a reference to any other law which is imposed in Singapore after
the date of signature of this Agreement in modification of, or in addition to,
or in substitution for, that Act and which is agreed, in an Exchange of
Letters between the Contracting States, to be of a substantially similar
character to the provisions of that Act as in force at the date of signature of
this Agreement.
5. Notwithstanding paragraph 3, a New Zealand resident deriving
income from Singapore, being income referred to in that paragraph, shall
not be deemed to have paid Singapore tax in respect of such income
where the competent authority of New Zealand considers, after
31
consultation with the competent authority of Singapore, that it is
inappropriate to do so having regard to:
(a) whether any prearrangements have been entered into by
any person for the purpose of taking advantage of paragraph
3 for the benefit of that person or any other person;
(b) whether any benefit accrues or may accrue to a person who
is neither a New Zealand resident nor a Singapore resident;
(c) the prevention of fraud or the avoidance of the taxes to
which the Agreement applies;
(d) any other matter which the competent authorities consider
relevant in the particular circumstances of the case including
any submissions from the New Zealand resident concerned.
6. The provisions of paragraph 3 shall apply for the first 10 years for
which the Agreement is effective.
Article 22
Mutual Agreement Procedure
1. Where a person considers that the actions of one or both of the
Contracting States result or will result for that person in taxation not in
accordance with the provisions of this Agreement, that person may,
irrespective of the remedies provided by the domestic law of those States,
present a case to the competent authority of the Contracting State of
which the person is a resident. The case must be presented within three
years from the first notification of the action resulting in taxation not in
accordance with the provisions of the Agreement.
32
2. The competent authority shall endeavour, if the objection appears
to it to be justified and if it is not itself able to arrive at a satisfactory
solution, to resolve the case by mutual agreement with the competent
authority of the other Contracting State, with a view to the avoidance of
taxation which is not in accordance with the Agreement. Any agreement
reached shall be implemented notwithstanding any time limits in the
domestic law of the Contracting States.
3. The competent authorities of the Contracting States shall
endeavour to resolve by mutual agreement any difficulties or doubts
arising as to the interpretation or application of the Agreement.
4. The competent authorities of the Contracting States may
communicate with each other directly for the purpose of reaching an
agreement in the sense of the preceding paragraphs.
Article 23
Exchange of Information
1. The competent authorities of the Contracting States shall exchange
such information as is foreseeably relevant for carrying out the provisions
of this Agreement or to the administration or enforcement of the domestic
laws concerning taxes of every kind and description imposed on behalf of
the Contracting States, or of their political subdivisions or local authorities,
insofar as the taxation thereunder is not contrary to the Agreement. The
exchange of information is not restricted by Articles 1 and 2.
2. Any information received under paragraph 1 by a Contracting State
shall be treated as secret in the same manner as information obtained
under the domestic laws of that State and shall be disclosed only to
persons or authorities (including courts and administrative bodies)
33
concerned with the assessment or collection of, the enforcement or
prosecution in respect of, the determination of appeals in relation to the
taxes referred to in paragraph 1, or the oversight of the above. 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.
3. In no case shall the provisions of paragraphs 1 and 2 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 of that or of the other
Contracting State;
(b) to supply information which is not obtainable under the laws
or in the normal course of the administration of that or of 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 of which would
be contrary to public policy (ordre public).
4. If information is requested by a Contracting State in accordance
with this Article, the other Contracting State shall use its information
gathering measures to obtain the requested information, even though that
other State may not need such information for its own tax purposes. The
obligation contained in the preceding sentence is subject to the limitations
of paragraph 3 but in no case shall such limitations be construed to permit
a Contracting State to decline to supply information solely because it has
no domestic interest in such information.
34
5. In no case shall the provisions of paragraph 3 be construed to
permit a Contracting State to decline to supply information solely because
the information is held by a bank, other financial institution, nominee or
person acting in an agency or a fiduciary capacity or because it relates to
ownership interests in a person.
Article 24
Members of Diplomatic Missions and Consular Posts
Nothing in this Agreement shall affect the fiscal privileges of
members of diplomatic missions or consular posts under the general rules
of international law or under the provisions of special agreements.
Article 25
Entry into Force
1. This Agreement shall enter into force on the last date on which the
Contracting States exchange notes through the diplomatic channel
notifying each other that the last of such things has been done as is
necessary to give the Agreement the force of law in New Zealand and in
Singapore, as the case may be, and, in that event, the Agreement shall
have effect:
(a) in New Zealand:
(i) in respect of withholding tax on income, profits or
gains derived by a non-resident, for amounts paid or
credited on or after the first day of the second month
next following the date on which the Agreement
enters into force;
35
(ii) in respect of other New Zealand tax, for any income
year beginning on or after 1 April next following the
date on which the Agreement enters into force;
(b) in Singapore:
in respect of tax chargeable for any year of assessment
beginning on or after 1 January in the second calendar year
following the year in which the Agreement enters into force.
2. The Agreement between the Government of New Zealand and the
Government of the Republic of Singapore for the avoidance of double
taxation and the prevention of fiscal evasion with respect to taxes on
income, with Protocol, signed on 21st August 1973 as amended by a
Second Protocol signed on 1st July 1993 and a Third Protocol signed on
5th September 2005 shall terminate and cease to have effect in relation to
any tax in respect of which this Agreement comes into effect in
accordance with paragraph 1. To the extent that the first-mentioned
Agreement applies to taxes not covered by this Agreement, the first-
mentioned Agreement as it relates to such taxes shall also terminate and
cease to have effect from the date of entry into force of this Agreement.
3. Notwithstanding paragraph 1 of this Article, if, on the date that
Singapore notifies New Zealand that the last of such things has been done
as is necessary to give the Agreement force of law in Singapore in
accordance with paragraph 1 of this Article, Singapore has not completed
its domestic legislative requirements necessary for entry into force of
Article 23, such circumstances shall be recorded in Singapore's
notification under paragraph 1 of this Article and Article 23 shall not enter
into force for Singapore.
36
4. If the circumstances described in paragraph 3 of this Article prevail,
Singapore shall notify New Zealand when it has completed its domestic
legislative requirements necessary for entry into force of Article 23. Article
23 shall enter into force for Singapore 30 days after the date of such
notification.
5. Notwithstanding paragraph 2 of this Article, if the circumstances
described in paragraphs 3 and 4 of this Article prevail, Singapore shall
continue to be bound by its obligations under Article 21 (Exchange of
Information) of the Agreement between the Government of New Zealand
and the Government of the Republic of Singapore for the avoidance of
double taxation and the prevention of fiscal evasion with respect to taxes
on income, with Protocol, signed on 21st August 1973 as amended by a
Second Protocol signed on 1st July 1993 and a Third Protocol signed on
5th September 2005 until such time as Article 23 of the Agreement enters
into force for Singapore in accordance with paragraph 4 of this Article.
Article 26
Termination
This Agreement shall remain in force until terminated by a
Contracting State. Either Contracting State may terminate the Agreement,
through diplomatic channels, by giving notice of termination on or before
30 June in any calendar year beginning after the expiration of 5 years from
the date of its entry into force. In such event, the Agreement shall cease
to have effect:
(a) in New Zealand:
(i) in respect of withholding tax on income, profits or
gains derived by a non-resident, for amounts paid or
37
credited on or after the ffrst day of the second month
next foiiowirig that in which the notice of termination is
given;
(ii) in respect of other Neni Zealand tax. for any income
year beginning on or after 1 April in the calendar year
next following that in which the notice of termination is
given;
(b) in Singapore:
in respect of tax chargeable for any year of assessment
beginning on or after 2 January in the second calendar year.
foliowing the year in which the notice is given.
IN WITNESS WHEREOF the unders~gned, duiy aulhonsed by i h e ~ r
respective Governments, have signed this Agreement.
DoNE in duplicate at [S!:;I~?PD.":.":%~
th~s [.&!,?ifi day of
....A.?4.~6.+....j, [X??,] the English language.
in
For the Government o New ZeaBand:
f For the Government of the Republic of.. . , . :.
: ".
Singapossr
Name: fiRR'Trw 1,--4/2_ ~ame: P&%
Protocol
The Government of New Zealand and the Government of the
Republic of Singapore have agreed that the following provisions shall form
an integral part of the Agreement:
Article I
With reference to Article 2 of the Agreement:
It is understood that the taxes covered by the Agreement do not
include any amount which represents a penalty or interest imposed under
the laws of either Contracting State.
Article II
With reference to Article 5 of the Agreement:
It is understood that profits attributable, if any, to a permanent
establishment existing under paragraph 7 will be determined in
accordance with Article 7 of the Agreement.
39
Article III
With reference to Article 6 of the Agreement:
Any right referred to in paragraph 2 shall be regarded as situated
where the property to which it relates is situated or where the exploration
or exploitation may take place.
Article IV
With reference to Article 8 of the Agreement:
It is understood that the interpretation in the Commentary to Article
8 of the OECD Model Tax Convention on Income and on Capital as it read
on 17 July 2008 shall apply in relation to interest. In particular it is
understood that interest on funds connected with the operation of ships or
aircraft in international traffic shall be regarded as profits derived from
such operations where the investment that generates that interest is made
as an integral part of the carrying on of the business of the operation of
ships or aircraft in international traffic.
Article V
With reference to Article 11 of the Agreement:
Penalty charges for late payment for trade credits shall not be
regarded as interest for the purpose of this Article.
40
Article VI
With reference to Articles 10, 11 and 12 of the Agreement:
If, in an agreement for the avoidance of double taxation that is
made, after the date of signature of this Agreement, between New
Zealand and a third State, New Zealand agrees to limit the rate of tax:
(a) on dividends paid by a company which is a resident of New
Zealand for the purposes of New Zealand tax to which a
company that is a resident of the third State, or the third
State or a political subdivision or a local authority or a
statutory body or institution thereof is entitled, to a rate less
than that provided in paragraph (2) of Article 10; or
(b) on interest arising in New Zealand to which a resident of the
third State is entitled, to a rate less than that provided in
paragraph (2) of Article 11; or
(c) on royalties arising in New Zealand to which a resident of the
third State is entitled, to a rate less than that provided in
paragraph (2) of Article 12,
the Government of New Zealand shall immediately inform the Government
of the Republic of Singapore in writing through the diplomatic channel and
shall enter into negotiations with the Government of the Republic of
Singapore to review the relevant provisions in order to provide the same
treatment for Singapore as that provided for the third State.
41
It is understood that paragraph 6 of Article '0 and paragraph 7 of Article
l
12 shall not apply to a bona fide arrangement motivated by sound
business reasons.
1 VVITNESS WHEREOF the undersigned, duly authorised by their
N
respective Governments, have signed this Agreement.
DONE in duplicate at [.S