AGREEMENT
BETWEEN
THE GOVERNMENT OF THE REPUBLIC OF AUSTRIA AND THE GOVERNMENT OF THE ISLAMIC
REPUBLIC OF IRAN FOR THE AVOIDANCE OF DOUBLE TAXATION WITH RESPECT TO TAXES ON
INCOME AND ON CAPITAL
The Government
of the Republic of Austria and the Government of the Islamic Republic of Iran,
desiring to conclude an Agreement for the avoidance of double taxation with
respect to taxes on income and on capital,
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) This Agreement shall apply to taxes on
income and on capital imposed on behalf of a Contracting State or of its
political subdivisions or local authorities, irrespective of the manner in
which they are levied.
(2) There shall be regarded as taxes on
income and on capital all taxes imposed on total income, on total capital, or
on elements of income or of capital, including taxes on gains from the
alienation of movable or immovable property, taxes on the total amounts of
wages or salaries paid by enterprises, as well as taxes on capital
appreciation.
(3) The existing taxes to which the Agreement
shall apply are in particular:
a) in the Republic of Austria:
(i) the income tax;
(ii) the corporation tax;
(iii) the land tax;
(iv) the tax on agricultural and
forestry enterprises;
(v) the tax on the value of
vacant plots;
b) in the Islamic Republic of Iran:
(i) the income tax;
(ii) the property tax.
(4) 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 of the Contracting States shall notify each other 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)
(i) the term „Republic of
Austria“ means the territory under the sovereignty and/or jurisdiction of the
Republic of Austria;
(ii) the term „Islamic Republic of
Iran“ means the territory under the sovereignty and/or jurisdiction of the
Islamic Republic of Iran;
b) the term „person“ includes an individual, a
company and any other body of persons;
c) the term „company“ means any body corporate or
any entity that is treated as a body corporate for tax purposes;
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;
f) the term „competent authority“ means:
(i) in the Republic of Austria: the Federal
Minister of Finance or his authorized representative;
(ii)
in the Islamic Republic
of Iran: the Minister of Economic Affairs and Finance or his authorized
representative;
g) the term „national“ means:
(i)
any individual
possessing the nationality of a Contracting State;
(ii)
any legal person,
partnership or association deriving its status as such from
the
laws in force in a Contracting State.
(2) As regards the application of the
Agreement by a Contracting State, any term not defined therein shall, unless
the context otherwise requires, have the meaning which it has under the laws of
that State concerning the taxes to which the Agreement applies.
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 his domicile, residence, place of management or any other
criterion of a similar nature, and also includes that State and any political
subdivision or local authority thereof. 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 capital situated therein.
(2) Where by reason of the provisions of
paragraph 1 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 has not 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 neither of the States,
the competent authorities of the Contracting States shall endeavour to 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.
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 exploration, exploitation and/or extraction of natural
resources.
(3) A building site, a construction, assembly
or installation project, including supervisory activities connected therewith,
constitutes a permanent establishment only if it lasts more than twelve months.
(4) Notwithstanding
the preceding provisions of this Article, the term „permanent establishment“ shall be deemed not to
include:
a) the use of facilities solely for the purpose of
storage or display 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 or
display;
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 subparagraphs 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.
(5) Notwithstanding
the provisions of paragraphs 1 and 2, where a person ‑ other than an agent
of an independent status to whom paragraph 6 applies ‑ is acting on behalf
of an enterprise and has, and habitually exercises, in a Contracting State an
authority to conclude contracts in the name of 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 4 which,
if exercised through a fixed place of business, would not make this fixed place
of business a permanent establishment under the provisions of that paragraph.
(6) 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. However, when the activities of such an
agent are devoted wholly or almost wholly on behalf of that enterprise, he
shall not be considered an agent of an independent status if the transactions
between the agent and the enterprise were not made under arm's length
conditions.
(7) 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.
Article
6
INCOME
FROM IMMOVABLE PROPERTY
(1) Income derived by a resident of a
Contracting State from immovable property
(including income from agriculture or forestry) 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 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 and rights to variable or fixed payments as consideration
for the working of, or the right to work, mineral deposits, sources and other
natural resources, including oil or gas wells and quarries. 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 and to
income from immovable property used for the performance of independent personal
services.
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 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) Insofar as it has been customary in a
Contracting State to determine the profits to be attributed to a permanent
establishment on the basis of an apportionment of the total profits of the
enterprise to its various parts, nothing in paragraph 2 shall preclude that
Contracting State from determining the profits to be taxed by such an
apportionment as may be customary; the method of apportionment adopted shall,
however, be such that the result shall be in accordance with the principles
contained in this Article.
(5) 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.
(6) 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.
(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.
Article
8
SHIPPING
AND AIR TRANSPORT
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 Contracting 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 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 (other than a partnership) which holds directly
at least 25 per cent of the capital of the company paying the dividends;
b) 10 per cent of the gross amount of the
dividends in all other cases.
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, „jouissance“ shares or „jouissance“ rights,
mining shares, founders' shares or other rights, not being debt‑claims,
participating in profits, as well as income which is subjected to the same
taxation treatment 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, or performs in that other State independent
personal services from a fixed base situated therein, and the holding in
respect of which the dividends are paid is effectively connected with such
permanent establishment or fixed base. In such case the provisions of Article 7
or Article 14, as the case may be, 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 or a fixed base 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.
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 5 per cent of the gross amount of the interest.
(3) Notwithstanding
the provisions of paragraph 2, any such interest referred to in paragraph 1
shall be taxable only in the Contracting State of which the recipient is a
resident, if such recipient is the beneficial owner of the interest and if such
interest is paid:
a) to a Contracting State, other Governmental
institutions, municipalities, Central Banks or other banks wholly owned by a
Contracting State;
b) on a loan of whatever kind granted, insured or
guaranteed by a public institution for purposes of promoting exports;
c) in connection with the sale on credit of any
industrial, commercial or scientific equipment;
d) on any loan of whatever kind granted by a bank.
(4) 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. Penalty charges for late payment shall not be
regarded as interest for the purpose of this Article.
(5) The provisions of paragraphs 1 and 2
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, or performs in that other State
independent personal services from a fixed base situated therein, and the
debt-claim in respect of which the interest is paid is effectively connected
with such permanent establishment or fixed base. In such case the provisions of
Article 7 or Article 14, as the case may be, shall apply.
(6) 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 he is a resident of a Contracting State
or not, has in a Contracting State a permanent establishment or a fixed base in
connection with which the indebtedness on which the interest is paid was
incurred, and such interest is borne by such permanent establishment or fixed
base, then such interest shall be deemed to arise in the State in which the
permanent establishment or fixed is situated.
(7) 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.
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 received as a consideration for the use of,
or the right to use, any copyright of literary, artistic or scientific work
including cinematograph films and recordings for radio and television, any
patent, trade mark, design or model, plan, secret formula or process, or for
information concerning industrial, commercial or scientific experience or for
the use of, or the right to use, industrial, commercial or scientific
equipment.
(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, or
performs in that other State independent personal services from a fixed base
situated therein, and the right or property in respect of which the royalties
are paid is effectively connected with such permanent establishment or fixed
base. In such case the provisions of Article 7 or Article 14, as the case may
be, shall apply.
(5) Royalties
shall be deemed to arise in a Contracting State when the payer is a resident of
that State. Where, however, the person paying the royalties, whether he is a
resident of a Contracting State or not, has in a Contracting State a permanent
establishment or a fixed base in connection with which the right or property
giving rise to the royalties is effectively connected, and such royalties are
borne by such permanent establishment or fixed base, then such royalties shall
be deemed to arise in the Contracting State in which the permanent
establishment or fixed base 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 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.
Article
13
CAPITAL
GAINS
(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
or of movable property pertaining to a fixed base available to a resident of a
Contracting State in the other Contracting State for the purpose of performing
independent personal services including such gains from the alienation of such
a permanent establishment (alone or with the whole enterprise) or of such fixed
base, may be taxed in that other State.
(3) Gains derived by an enterprise of a
Contracting State from the alienation of ships or aircraft operated in
international traffic or movable property pertaining to the operation of such
ships or aircraft, shall be taxable only in that Contracting State.
(4) Gains from the alienation of any property
other than that referred to in paragraphs 1, 2 and 3, shall be taxable only in
the Contracting State of which the alienator is a resident.
Article
14
INDEPENDENT
PERSONAL SERVICES
(1) Income derived by a resident of a
Contracting State in respect of professional services or other activities of an
independent character shall be taxable only in that State unless he has a fixed
base regularly available to him in the other Contracting State for the purpose
of performing his activities. If he has such a fixed base, the income may be
taxed in the other State but only so much of it as is attributable to that
fixed base.
(2) The term „professional services“ includes
especially independent scientific, literary, artistic, educational or teaching
activities as well as the independent activities of physicians, lawyers,
engineers, architects, dentists and accountants.
Article
15
DEPENDENT
PERSONAL SERVICES
(1) Subject to the provisions of Articles 16,
18 and 19, 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 twelve month
period commencing or ending in the fiscal year 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 a permanent
establishment or a fixed base which the employer has in the other State.
(3) Notwithstanding
the preceding provisions of this Article, remuneration paid by an enterprise of
a Contracting State in respect of an employment exercised aboard a ship or
aircraft operated in international traffic, may be taxed only in that
Contracting State.
Article
16
DIRECTORS'
FEES
Directors' fees
and other similar payments derived by a resident of a Contracting State in his
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
17
ARTISTES
AND SPORTSMEN
(1) Notwithstanding
the provisions of Articles 7, 14 and 15, 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 sportsman, from his 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 sportsman in his capacity as such
accrues not to the entertainer or sportsman himself but to another person, that
income may, notwithstanding the provisions of Articles 7, 14 and 15, be taxed
in the Contracting State in which the activities of the entertainer or sportsman
are exercised.
(3) The provisions of paragraphs 1 and 2
shall not apply to income derived from activities performed in a Contracting
State by artistes or sportsmen if the visit to that State is wholly or mainly
supported by public funds of the other State or political subdivisions or local
authorities thereof or by an institution which is recognised as a non-profit
institution. In such a case, the income is taxable only in the Contracting
State in which the person is a resident.
Article
18
PENSIONS
Subject to the
provisions of paragraph 2 of Article 19, 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.
Article
19
GOVERNMENT
SERVICE
(1) a) Salaries,
wages and other similar remuneration, other than a pension, paid by a
Contracting State or a political subdivision or a local authority thereof to an
individual in respect of services rendered to that State or subdivision or
authority 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) Any pension paid by, or out of funds
created by, a Contracting State or a political subdivision or a local authority
thereof to an individual in respect of services rendered to that State or
subdivision or authority shall be taxable only in that State.
b) However,
such pension shall be taxable only in the other Contracting State if the
individual is a resident of, and a national of, that State.
(3) The
provisions of paragraph 1 of this Article shall likewise apply in respect of
remuneration paid to the Foreign Trade Commissioners of the Contracting States
and to the members of their staff.
(4) The provisions of Articles 15, 16, 17,
and 18 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
thereof.
Article
20
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 his education or training receives for the
purpose of his maintenance, education or training shall not be taxed in that
State, provided that such payments arise from sources outside that State.
Article
21
OTHER
INCOME
(1) 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.
(2) The provisions of paragraph 1 shall not
apply to income, other than income from immovable property as defined in
paragraph 2 of Article 6, if the recipient of such income, being a resident of
a Contracting State, carries on business in the other Contracting State through
a permanent establishment situated therein, or performs in that other State
independent personal services from a fixed base situated therein, and the right
or property in respect of which the income is paid is effectively connected
with such permanent establishment or fixed base. In such case the provisions of
Article 7 or Article 14, as the case may be, shall apply.
(3) Income derived by a resident of a
Contracting State from the other Contracting State under a legal claim to
maintenance may not be taxed in the first-mentioned State if such income would
be exempt from tax according to the laws of the other Contracting State.
Article
22
CAPITAL
(1) Capital represented by immovable property
referred to in Article 6, owned by a resident of a Contracting State and
situated in the other Contracting State, may be taxed in that other State.
(2) Capital represented by 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 or by
movable property pertaining to a fixed base available to a resident of a
Contracting State in the other Contracting State for the purpose of performing
independent personal services, may be taxed in that other State.
(3) Capital represented by ships and aircraft
operated by an enterprise of a Contracting State in international traffic and
by movable property pertaining to the operation of such ships and aircraft
shall be taxable only in that Contracting State.
(4) All other elements of capital of a
resident of a Contracting State shall be taxable only in that State.
Article
23
ELIMINATION
OF DOUBLE TAXATION
(1) In the Republic of Austria double
taxation shall be eliminated as follows:
a) Where a resident of the Republic of Austria
derives income or owns capital which, in accordance with the provisions of this
Agreement, may be taxed in the Islamic Republic of Iran, the Republic of
Austria shall, subject to the provisions of subparagraphs b) to c) and
paragraph 3, exempt such income or capital from tax.
b) Where a resident of the Republic of Austria
derives items of income which, in accordance with the provisions of Articles
10, 11 and 12, may be taxed in the Islamic Republic of Iran, the Republic of
Austria shall allow as a deduction from the tax on the income of that resident
an amount equal to the tax paid in the Islamic Republic of Iran. Such deduction
shall not, however, exceed that part of the tax, as computed before the
deduction is given, which is attributable to such items of income derived from
the Islamic Republic of Iran.
c) The provisions of subparagraph a) shall not
apply to income derived or capital owned by a resident of the Republic of
Austria where the Islamic Republic of Iran applies the provisions of this
Agreement to exempt such income or capital from tax or applies the provisions
of paragraph 2 of Article 10, 11 or 12 to such income.
(2) In the Islamic Republic of Iran double
taxation shall be eliminated as follows:
Where
a resident of the Islamic Republic of Iran derives income or owns capital
which, in accordance with the provisions of this Agreement, may be taxed in the
Republic of Austria, the Islamic Republic of Iran shall allow:
a) as a deduction from the tax on the income of
that resident, an amount equal to the income tax paid in the Republic of
Austria;
b) as a deduction from the tax on the capital of
that resident, an amount equal to capital tax paid in the Republic of Austria.
Such
deduction in either case shall not, however, exceed that part of the tax as
computed before the deduction is given, which is attributable, as the case may
be, to the income or the capital which may be taxed in the Republic of Austria.
(3) Where in accordance with any provision of
the Agreement income derived or capital owned by a resident of a Contracting
State is exempt from tax in that State, such State may nevertheless, in
calculating the amount of tax on the remaining income or capital of such
resident, take into account the exempted income or capital.
Article
24
NON‑DISCRIMINATION
(1) Nationals
of a Contracting State shall not be subjected in the other Contracting State to
any taxation or any requirement connected therewith, which is other or more
burdensome than the taxation and connected requirements to which nationals of
that other State in the same circumstances, in particular with respect to
residence, are or may be subjected. This provision shall, notwithstanding the
provisions of Article 1, also apply to persons who are not residents of one or
both of the Contracting States.
(2) The taxation on a permanent establishment
which an enterprise of a Contracting State has in the other Contracting State
shall not be less favourably levied in that other State than the taxation
levied on enterprises of that other State carrying on the same activities. This
provision shall not be construed as obliging a Contracting State to grant to
residents of the other Contracting State any personal allowances, reliefs and
reductions for taxation purposes on account of civil status or family
responsibilities which it grants to its own residents.
(3) Except where the provisions of paragraph
1 of Article 9, paragraph 7 of Article 11, or paragraph 6 of Article 12, apply,
interest, royalties and other disbursements paid by an enterprise of a
Contracting State to a resident of the other Contracting State shall, for the
purpose of determining the taxable profits of such enterprise, be deductible
under the same conditions as if they had been paid to a resident of the first‑mentioned
State. Similarly, any debts of an enterprise of a Contracting State to a
resident of the other Contracting State shall, for the purpose of determining
the taxable capital of such enterprise, be deductible under the same conditions
as if they had been contracted to a resident of the first‑mentioned State.
(4) Enterprises
of a Contracting State, the capital of which is wholly or partly owned or
controlled, directly or indirectly, by one or more residents of the other
Contracting State, shall not be subjected in the first‑mentioned State to any
taxation or any requirement connected therewith which is other or more
burdensome than the taxation and connected requirements to which other similar
enterprises of the first‑mentioned State are or may be subjected.
(5) The provisions of this Article shall,
notwithstanding the provisions of Article 2, apply to taxes of every kind and
description.
Article
25
MUTUAL
AGREEMENT PROCEDURE
(1) Where a person considers that the actions
of one or both of the Contracting States result or will result for him in
taxation not in accordance with the provisions of this Agreement, he may,
irrespective of the remedies provided by the domestic law of those States,
present his case to the competent authority of the Contracting State of which
he is a resident or, if his case comes under paragraph 1 of Article 24, to that
of the Contracting State of which he is a national. 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.
(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. They may also consult together for the elimination of double
taxation in cases not provided for in 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. The competent
authorities, through consultations, may develop appropriate procedures,
conditions, methods and techniques for the implementation of the mutual
agreement procedure provided for in this Article.
Article
26
EXCHANGE
OF INFORMATION
(1) The competent authorities of the
Contracting States shall exchange such information as is necessary for carrying
out the provisions of this Agreement. The exchange of information is not
restricted by Article 1. Any information received 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) concerned with the assessment or
collection of, the enforcement or prosecution in respect of, or the
determination of appeals in relation to the taxes covered by this Agreement.
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.
(2) In no case shall the provisions of
paragraph 1 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).
Article
27
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
28
ENTRY
INTO FORCE
(1) This Agreement shall be ratified and the
instruments of ratification shall be exchanged as soon as possible.
(2) The Agreement shall enter into force
sixty days after the date on which the exchange of instruments of ratification
will have taken place and its provisions shall have effect in respect of taxes
for any fiscal year beginning in the calendar year next following that in which
the exchange of instruments of ratification will have taken place.
Article
29
TERMINATION
This Agreement
shall remain in force until it is terminated by a Contracting State. Either
Contracting State may terminate the Agreement, through diplomatic channels, by
giving notice of termination at least six months before the end of any
calendar year following the period of five years from the date on which the
Agreement enters into force. In such event, the Agreement shall cease to have
effect in respect of the taxes for any fiscal year beginning in the calendar
year next following that in which the notice of termination has been given.
IN WITNESS
WHEREOF the undersigned, duly authorized thereto, by their respective
Governments, have signed this Agreement.
DONE in
duplicate in
Vienna on the 11th day of March 2002,
corresponding to the 20th day of Esfand 1380 solar Hijra , in the
German, Persian and English languages, each text being equally authentic. In
case of any divergence the English text shall prevail.
For the Government of the Republic of
Austria: |
For the Government of the Islamic Republic of
Iran: |
Karl-Heinz GRASSER |
Eshaq JAHANGIRI |
PROTOCOL
At the moment
of signing the Agreement for the avoidance of double taxation with respect to
taxes on income and on capital, this day concluded between the Government of
the Republic of Austria and the Government of the Islamic Republic of Iran, the
undersigned have agreed that the following provisions shall form an integral
part of the Agreement.
1.
With reference to paragraph 3 of Article 17
It is
understood that paragraph 3 shall also apply to legal entities which carry on
orchestras or theatres as well as to members of such cultural entities if such
legal entities substantially are non-profit entities and if this is certified
by the competent authority of the State of residence.
2.
With reference to paragraph 3 of Article 21
The income
mentioned in this paragraph shall not be taken into consideration when applying
the exemption with progression method.
IN WITNESS
WHEREOF the undersigned, duly authorized thereto, by their respective
Governments, have signed this Protocol.
DONE in
duplicate in
Vienna on the 11th day of March 2002,
corresponding to the 20th day of Esfand 1380 solar Hijra , in the
German, Persian and English languages, each text being equally authentic. In
case of any divergence the English text shall prevail.
For the Government of the Republic of
Austria: |
For the Government of the Islamic Republic of
Iran: |
Karl-Heinz GRASSER |
Eshaq JAHANGIRI |