conventionbetween the repuelicof poland and the portuguese

CONVENTION
R E P U E L I C
THE
FOR
BETWEEN
THE
POLAND
AND
O F
PORTUGUESE
THE
DOUBLE
AVOIDANCE
T A X A T I O N
PFIEVENTION
E V A S I O N
R E P U B L I C
W I T H
TAXES
ON
O F
O F
AND
THE
F I S C A L
RESPECT
I N C O M E
TO
The Government
Government of the
Convention
for
of
the
Republic of
Poland
P o r t u g u e s e R e p u b l i c , desiring
the
prevention o f f i s c a l
avoidance
of
double
evasion with respect
and
t o conclude
taxation
t o t a x e s on
and
the
a
the
income,
h a v e agreed a s follows:
CHAPTER I
S C O P E OF T H E C O N V E N T I O N
Article 1
PERSONAL SCOPE
This
Convention
shall
apply
to
persons
who
are
r e s i d e n t s of o n e or both of the Contracting States.
Article 2
TAXES C O V E R E D
1.
on behalf
This Convention shall a p p l y t o taxes on income imposed
of
a
Contracting
State
or
of
its
a d m i n i s t r a t i v e subdivisions or local authorithies,
o f the manner in which they are levied.
political
or
irrespective
2.
There shall be regarded
imposed o n
taxes on
total income
gains
or on
from the
a s taxes on income all
elements of
alienation
property, taxes o n the total
income,
o f movable
or
taxes
including
immovable
amounts o f wages or salaries
paid
by enterprises, a s well a s taxes on capital appreciation.
3.
The existing taxes to which the Convention shall apply
are in particular:
a) In the case o f Poland:
[i)
The personal
income
tax (podatek
dochodowy
od
(podatek dochodowy
od
osob fizycznychl ; and
(ii) The corporate
income tax
osob prawnych;
(hereinafter referred to a s "Polish tax");
b)
In the case o f Portugal:
[i)
Personal income tax
(Imposto sobre o
d a s Pessoas Singulares
(ii) Corporate
income
tax
-
Rendimento
IRSI;
-
(Imposto
Rendimento d a s Pessoas Colectivas
-
sobre
IRC);
and
[iii] Local surtax on corporate income tax (Derrama);
(hereinafter referred to a s "Portuguese Tax").
o
to any identical
or
substantially similar taxes which are imposed after the date
of
signature of the Convention in addition to, or in place o f ,
the
4.
The Convention
existing taxes.
shall apply also
The competent
authorities of
the
Contracting
States shall notify each other of substantial changes which have
been made in their respective taxation laws.
CHAPTER I1
DEFINITIONS
Article 3
GENERAL DEFINITIONS
1.
For
the
purposes
of
this
Convention,
unless
the
context otherwise requires:
a)
the term "Poland" when used in geographical sense
means the territory
of the
Republic o f
Poland,
including any area beyond its territorial waters,
within which
under the
accordance with
laws
international
exercise its sovereign
of Poland
law,
and
Poland
rights over the
in
may
sea-bed,
its subsoil and their natural resources;
b]
the term "Portugal"
Portuguese
Republic
continent,
the
means the
situated
archipelagoes
Madeira, the respective
territory of
in
of
territorial
the
the
European
Azores
and
sea and any
other zone in which, in accordance with the
laws
of Portugal and international law, the Portuguese
Republic has its jurisdiction or sovereign rights
with respect to the exploration and
exploitation
of the
sea-bed
natural
resources
of
the
and
sub-soil, and of the superjacent waters;
c]
the terms "a
Contracting State"
Contracting State"
and "the
mean Poland
other
or Portugal,
as
the context requires;
d)
the
term
"person"
includes
an
individual,
a
company and any other body of persons;
el
the term "company"
means any
any entity which is
body corporate
treated a s a body
or
corporate
for tax purposes;
f]
the terms "enterprise of a Contracting State" and
"enterprise of the other Contracting State"
respectively
an
enterprise
carried
on
mean
by
a
resident of a Contracting State and an enterprise
carried on by a resident of the other Contracting
State;
g)
the
term
"international
transport by a ship,
transport
places
when t h e
vehicle
is
in a
its
Contracting
ship, aircraft
operated
any
transport
enterprise which has
effective management
State, except
means
aircraft or road
vehicle operated by an
place of
traffic"
solely
in the other Contracting State;
or
road
between
h)
the term "competent authority" means:
i
in the
case of Poland, the
Minister of
Finance
or his authorized representative;
(ii) in the case of Portugal, the Minister of Finance,
the Director General of Taxation
(Director-Geral
das C o n t r i b u i ~ d e se Impostos) or their authorized
representative;
i)
the term "national" means:
(i)
any individual
possessing the
nationality of
a
Contracting S t a t e ;
(ii) any
legal
person, partnership
deriving its
status a s
such
or
association
from the
laws
in
force in a Contracting State.
2.
As regards
the application of
the Convention at
time by a Contracting State, any term not defined therein
any
shall
unless the context otherwise requires, have the meaning which it
has at that time under the law of that State for the purposes o f
the taxes to which the Convention applies, any meaning under the
applicable tax
laws of
that State
prevailing over
a
meaning
given to the term under other laws o f that State concerning
taxes to which the Convention applies.
the
~
Article 4
RESIDENT
1.
For
the
"resident of a
of
this
Convention,
Contracting State" means
the laws of that
his domicile,
purposes
State, is liable to
residence,
place
criterion of a similar nature
of
the
term
any person w h o ,
under
tax therein by reason
management
or
any
of
other
and also includes that State
any political or administrative
subdivision or local
and
authority
thereof. This term, however, does not include any person who
liable to
tax in
that State
in respect
only of
income
is
from
sources in that State.
2.
Where by reason
individual is a
of the provisions
resident of both
of paragraph 1
an
Contracting States, then
his
status shall be determined a s follows:
a]
he shall be deeemed to be a resident only of the State
in which he has a permanent home available to him;
he has
a
permanent home
States, he shall be
the
State
with
available
deemed to be
which
his
to him
in
if
both
a resident only
personal
and
of
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 S t a t e ,
he
shall be deemed to be a resident only o f the State
in
which is has an habitual a b o d e ;
if he has an habitual abode in both States or
C]
neither of
them,
resident only
of
shall
he
be
the State
in
deemed to
be
a
which he
is
a
of
national;
d]
if he is a national of both States or of
of
them,
the
competent
Contracting States shall
authorities
neither
of
the
settle the question
by
mutual agreement.
3.
person
Where by
other
reason of
than
an
.the provisions of
individual
Contracting States, then
is
it shall
a
paragraph
resident
be deemed to
be a
of
1
a
both
resident
only of the State in which its place of effective management
is
situated.
Article 5
PERMANENT ESTABLISHMENT
1.
For
"permanent
the
purposes
establishment"
of
means
this
a
Convention,
fixed
place
of
the
term
business
through which the business of an enterprise is wholly or
partly
carried o n .
2.
The
term
"permanent
especially:
a)
a place of management;
bl
a branch;
cl
an office;
establishment"
includes
d)
a factory;
el
a workshop, and
f)
a mine, an
oil or
gas well,
a quarry
o r any
other
place of extraction of natural resources.
A
3.
building
site,
a
construction,
assembly
installation project constitutes a permanent establishment
or
only
if it lasts more than twelve months.
Notwithstanding
4.
the
preceding
provisions
of
this
'Article, the term "permanent establishment" shall be deemed
not
to include:
a)
the use
of
facilities
solely
storage, display or delivery
for
the
o f goods o r
purpose
of
merchandise
belonging to the enterprise;
b1
the maintenance
of a
stock of
goods o r
merchandise
belonging to the enterprise solely for the purpose
of
storage, display or delivery;
c1
the maintenance
of a
stock of
goods o r
merchandise
belonging to the enterprise solely f o r the purpose
of
processing by another enterprise;
d1
the maintenance of
a fixed place
of business
solely
for the purpose of purchasing goods o r merchandise
or
o f collecting information, for the enterprise;
e1
the maintenance of a fixed place of business solely
for the purpose of carrying on, f o r the enterprise,
any other
character;
activity
of
a
preparatory
or
auxiliary
f)
the maintenance of
for
any
a fixed place
combination
sub-paragraphs a)
activity o f
of
activities
to e),
the fixed
of business
mentioned
provided that
place of
solely
the
business
in
overall
resulting
from this combination is of a preparatory or auxiliary
character.
5.
Notwithstanding the provisions of paragraphs 1 and
where a person
-
other than an agent of an independent status to
whom paragraph 6 applies
and has, and
-
is acting on behalf of an
habitually exercises,
authority to conclude contracts in
that
2,
enterprise
shall
be
in a
establishment in that State in
Contracting State
the name of the
deemed
enterprise
to
have
an
enterprise,
a
permanent
respect of any activities
which
that person undertakes f o r 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
establishment in a Contracting
permanent
State merely because it
on business in that State through a broker, general
carries
commisssion
agent o r any other agent of an independent status, provided that
such
persons
are
acting
in
the
ordinary
course
of
a company
which is
a resident
their
business.
7.
The
fact that
Contracting State controls or i s
is a resident of the
on business in
establishment or
controlled by a company
other Contracting State, or which
that other
State (whether
otherwise),
shall not
through a
of
itself
either company a permanent establishment of the other.
of
a
which
carries
permanent
constitute
CHAPTER I11
TAXATION OF INCOME
Article 6
INCOME FROM IMMOVABLE PROPERTY
1.
Income derived
from immovable property
by a resident
of a Contracting
(including income
forestry) situated in the other
State
from agriculture
Contracting State may be
or
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
usufruct of immovable property and
payments as consideration for
work, mineral
ships,
and
road
property
apply,
rights to variable or
the working o f ,
deposits, sources
aircraft
landed
and other
transport
or the right
natural
vehicles
fixed
to
resources;
shall
not
be
regarded as immovable property .
3.
The provisions
of paragraph 1
derived from the direct use, letting,
shall apply to
income
or use in any other
form
of immovable property.
4.
The provisions of paragraphs 1 and 3 shall also
to the income from
income from
immovable property of
immovable
property
independent personal services.
used for
apply
an enterprise and
the
performance
to
of
5.
The foregoing
provisions shall also
apply to
income
from movable property, or income derived from services connected
with the use or the right to use the immovable property,
under the taxation
law of
the Contracting State
which,
in which
the
property in question is situated, is assimilated to income
from
immovable property.
Article 7
BUSINESS PROFITS
1.
The profits
shall be
taxable
of an enterprise
only
carries on business
in that
in the
permanent establishment
of a Contracting
State
unless
other Contracting
situated
enterprise
State through
If
a
the
enterprise
carries on business as aforesaid, the profits of the
enterprise
may be taxed in the other State
therein.
the
State
but only so much of them as
is
attributable to that permanent establishment.
2.
Subject to
enterprise of a
other
the provisions
Contracting State
Contracting
situated therein,
State
shall
carries on
a
business in
permanent
the
establishment
be
attributed to that permanent establishment the profits which
it
to make if
in each
an
State
might be expected
there
through
3, where
of paragraph
it were a
enterprise engaged in the same
Contracting
distinct and
separate
or similar activities under
the
same or similar conditions and dealing wholly independently with
the enterprise of which it is a permanent establishment.
In
3.
determining
establishment, there
which
are
incurred
the
shall be
for
the
profits
allowed a s
purposes
of
a
deductions
of
the
permanent
expenses
permanent
establishment, including
expenses
so
incurred,
executive and
whether
in
general
the
administrative
State
in
which
the
permanent establishment is situated or elsewhere.
Insofar
4.
as it
State to determine the
establishment on
profits o f
paragraph
the
2
has been
Contracting
a
profits to be attributed to a
the basis
of an
enterprise to
shall
customary in
preclude
apportionment of
its
the
various parts,
that
permanent
total
nothing
Contracting
State
from
determining the profits to be taxed by such an apportionment
may be
customary; the
method o f
in
apportionment adopted
as
shall,
however, be such that the result shall be in accordance with the
principles contained in this Article.
5.
No
profits
shall
be
establishment by reason of the
attributed
to
a
mere purchase by that
permanent
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
with separately in other Articles
provisions of
those
Articles
provisions of this Article.
dealt
of this Convention, then
shall not
be
affected
by
the
the
Article 8
INTERNATIONAL TRANSPORT
Profits from the operation of ships, aircraft or
1.
transport vehicles
in international
only in the Contracting
traffic shall
State in which
be
the place of
road
taxable
effective
management of the enterprise is situated.
2.
If the
enterprise is
place of
aboard a
effective management
ship, then
the ship is situated, or, if
the Contracting State
shipping
to
be
in which the home harbour
of
there is no such home harbour,
in
'situated in the Contracting State
it shall
of a
of which the
be deemed
operator of the
ship is
a
apply
to
resident.
3.
The
provisions o f
paragraph 1
shall also
profits from the participation in a pool, a joint business or an
international operating agency.
Article 9
ASSOCIATED ENTERPRISES
1.
Where
a] an enterprise
of
a
Contracting
directly or indirectly in
capital of
State, or
an
State
participates
the management, control
enterprise of
the
other
or
Contracting
b)
the same persons participate directly or indirectly in
the management, control o r capital o f an enterprise of
a Contracting
State and
an enterprise
o f the
other
Contracting S t a t e ,
and in either case
conditions are made
or imposed between
the
two enterprises in their commercial o r financial relations which
differ from
enterprises,
those
which
then
conditions, have
any
would
be
profits
accrued to
made
which
one of
between
would,
but
independent
for
the enterprises,
those
but,
by
reason of those conditions, have not s o accrued, may be included
in the profits of that enterprise and taxed accordingly.
2.
Where a Contracting State
a n enterprise of that State
which an
enterprise of
-
includes in the profits
and taxes accordingly - profits on
the other
Contracting State
charged to tax in that other
State and the profits s o
are profits which would have
accrued to the enterprise
first-mentioned State
enterprises had been
if the
conditions made
those which would
independent enterprises,
of
then that
been
included
of
the
between the
two
have been made
other State
has
between
shall make
appropriate adjustment to the amount of the tax charged
an
therein
on those profits where that other State considers the adjustment
justified. I n determining such
adjustment, due regard shall
be
had to the other provisions of this Convention and the competent
authorities of the Contracting States shall if necessary consult
each other.
Article 10
DIVIDENDS
1.
Dividends paid by a company
Contracting State to a resident
which i s a resident o f
o f the other Contracting
a
State
I
may be taxed i n that other S t a t e .
2.
However, such
dividends
may
a l s o be
taxed in
the
Contracting State o f which the company paying the dividsnds i s a
.
resident and according
beneficial owner o f
to the laws
the dividends
I
I
of that S t a t e ,
i s a resident
but i f
o f the
the
other
I1
I
,
i
I
I
Contracting State the
tax s o
charged shall not
exceed 15
per
cent o f the gross amount of the dividends.
The competent
shall by
authorities o f
mutual agreement
settle the
the Contracting
mode o f
States
application
of
these limitations.
T h i s paragraph shall
not affect the
taxation o f
the
company in respect o f the profits out o f which the dividends a r e
paid.
3.
Notwithstanding the
provisions o f paragraph 2, i f the
beneficial owner i s a company t h a t , f o r a n uninterrupted
period
o f t w o y e a r s prior to the payment of the dividend, o w n s directly
at least 25
per cent o f
the capital
the company paying the dividends,
exceed with respect to dividends
stock [capital social) o f
the tax s o charged shall
paid after December 31,
10 per cent o f the gross amount of such dividends.
not
1996,
4.
The term
"dividends" as
used in
this Article
income from shares, "jouissance" shares or "jouissance"
mining
shares,
foundersfshares
debt-claims, participating in
which the company
other
rights,
profits, as well
other corporate rights which is
treatment as income
or
making the
by the
being
as income
laws of
distribution is
rights,
not
subjected to the same
from shares
means
from
taxation
the State
a resident.
of
The
provisions of this article shall also apply to profits paid to a
person associated to a business activity carried out by
another
person under an arrangement for participation in profits as laid
down by the law of each Contracting State ( i n case of
Portugal,
a s s o c i a ~ i oem participaGSo1.
5.
The
provisions of
paragraphs 1 ,
3 shall
2 and
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
from a fixed base situated
of which the
therein, and the holding in
dividends are paid
such permanent establishment
personal
services
respect
is effectively connected
or fixed
base. In
such case
with
the
provisions of Article '7 or Article 14, a s the case may be, shall
apply.
6.
Where a company which
State derives
profits
or
is a resident o f a
income from
the
other
State, that other State may not impose any tax on the
Contracting
Contracting
dividends
paid by the company, except
insofar as such dividends are
to a resident of that other
State or insofar as the holding
paid
in
respect of which the dividends are paid is effectively connected
with a permanent establishment o r a fixed base situated in
other S t a t e , nor subject the company's
that
undistributed profits to
a tax
on
the
company's
dividends paid or
undistributed
profits,
the undistributed profits
even
if
the
consist wholly
or
partly of profits or income arising in such other State.
Article 1 1
INTEREST
1.
Interest arising in a Contracting State and paid to
resident of the
other Contracting
State may be
taxed in
may also
taxed
a
that
other State.
2.
However,
such
interest
Contracting State in which it
be
in
arises and according to the
the
laws
o f that State, but if the beneficial owner of the interest is
resident o f
shall not
the other
exceed
interest. The
10
Contracting .State,
per
cent of
the
competent authorities
the tax
gross
of the
so
amount
a
charged
of
Contracting
the
State
shall by mutual agreement settle the mode o f application o f this
limitation.
3.
Notwithstanding
the
interest arising in a Contracting
provisions
of
paragraph
State shall be exempted
2,
from
tax in that State:
a]
if the debtor
of such interest
is the Government
that S t a t e , a political or administrative
or a local authority thereof; o r
of
subdivision
if interest i s
b]
paid to
Contracting
State,
subdivision
or
institution
a
or
the Government
a
political
local
or
authority
body
of the
other
administrative
thereof
(including
or
a
an
financial
institution) in connection with any financing
granted
by them under an agreement between the Governments
of
the Contracting States; or
in respect
c]
of
Banks
o f loans
the
or credit
Contracting
financial institution
made by
States
controlled
financing external business which
between the competent
by
the
and
Central
any
the
other
State
and
may be agreed
authorities o f the
upon
Contracting
States.
4.
The
term "interest"
a s used
in this
Article
means
income f r o m debt-claims o f every k i n d , whether o r not secured by
mortgage and whether o r not
the debtor's
securities
carrying a right to participate
profits, and in particular, income from
and
premiums and
income
prizes
debentures. Penalty
from
bonds
attaching
charges
in
government
or
debentures,
including
to such
securities,
bonds
or
not
be
for
late
payment
shall
regarded a s interest for the purpose of this Article.
5.
The
provisions o f
paragraphs 1 ,
2 and
3 shall
apply i f the beneficial owner o f the interest, being a
of a
Contracting
Contracting State
permanent
State,
in
carries
which
establishment
the
on
business
interest
in
arises,
not
resident
the
other
through
situated therein, o r performs in
a
that
other State
independent personal
situated therein, and
interest is paid i s
establishment or
services
the debt-claim
effectively
fixed base.
from a
in respect
connected
In such
fixed
base
of which
the
with such permanent
case the
provisions
of
Article 7 or Article 14, a s the case may b e , shall apply.
6.
Interest shall
State when
the
however, the
payer
person
resident of a
be deemed
is
to arise
a resident
paying
the
and
such
interest
whether
in a
a fixed
base in
on which the
is
borne
Contracting
State.
or n o t , has
State a permanent establishment or
incurred,
that
interest,
Contracting State
with which the indebtedness
of
in a
he
State in which
is
connection
interest is paid
by
such
a
Contracting
was
permanent
establishment or fixed base, then such interest shall be
to arise in the
Where,
deemed
the permanent establishment
or
fixed base i s situated.
7.
Where, by reason of a special relationship between the
payer and the beneficial owner o r between both of them and
other person, the amount o f
the interest, having regard to
debt-claim f o r which it i s paid, exceeds the amount which
have been agreed upon by the
some
the
would
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 o f
the payments shall
remain taxable according
the laws of each Contracting S t a t e , due regard being had to
other provisions o f this Convention.
to
the
Article 12
ROYALTIES
Royalties arising in a Contracting State and paid to a
1.
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
recipient is the beneficial owner
of
the royalties the tax so charged shall not exceed 10 per cent of
the gross amount of the royalties. The competent authorities
of
the Contracting States shall by mutual agreement settle the mode
o f application of this limitation.
3.
The term "royalties", as
used in this Article,
means
payments of any kind received as a consideration for the use o f ,
or the
right to
use, any
copyright of
literary, artistic
or
scientific work including cinematograph films and films or tapes
for radio o r
television broadcasting, any
patent, trade
mark,
design or model, plan, secret formula or process, or for the use
o f , or the right to
use, industrial, commercial, or
scientific
equipment, or for information concerning industrial,
commercial
or scientific experience.
1 and 2 shall not
The provisions of paragraphs
4.
apply
if the beneficial owner of the royalties, being a resident of
Contracting State, carries on business in the other
State
in
which
the
royalties
arise,
establishment situated therein, or
independent
personal
services
through
Contracting
a
permanent
perfoms in that other
from
a
fixed
a
base
State
situated
therein, and
the right
or
property in
respect of
which
royalties are paid is effectively connected with such
establishment or
fixed base.
In such
case the
the
permanent
provisions
of
Article 7 or Article 14, as the case may be, shall apply.
5.
Royalties
Contracting
State.
State
Where,
whether he is
shall
be
when
the
however,
the
a resident
in a
Contracting State
base
in
connection
deemed
payer
person
of a
a permanent
with
which
resident
paying
the
permanent establishment
or
fixed
base,
then
the State in
a
that
royalties,
or not,
obligation
royalties are
in
of
establishment or
the
and such
to arise in
a
arise
Contracting State
royalties was incurred,
shall be deemed
is
to
fixed
a
to
has
pay
borne by
the
that
such
royalties
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
u s e , right or information for
the
amount which would have
beneficial owner
provisions
of
in
this
last-mentioned amount.
payments shall
which they are paid, exceeds
been agreed upon by
the
absence
Article
In such
remain taxable
of
shall
such
apply
c a s e , the
according to
the payer and
the
relationship,
the
only
excess part
the laws
Contracting State, due regard being had to the other
of this Convention.
to
of
of
the
the
each
provisions
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
part of
the business
which an
enterprise of
property
forming
of a
permanent
establishment
a Contracting
State has
in the
other
property pertaining to a
fixed
Contracting State or of movable
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
such
(alone
a
permanent
establishment
enterprise) or of such
fixed base, may be
or
with
the
of
whole
taxed in that
other
State.
3.
Gains from the alienation
of ships, aircraft or
transport vehicles operated in international traffic o r
road
movable
property pertaining to the operation of such ships, aircraft
road
transport
vehicles,
shall
be
taxable
only
in
or
the
Contracting State in which the place o f effective management
of
the enterprise i s situated.
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 o f which the alienator is a resident.
Article 14
INDEPENDENT PERSONAL SERVICES
1.
Income derived by a resident o f 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
Contracting State for the purpose of performing his
If he has
such a fixed
other State but only
base, the
income may be
so much of it
other
activities.
taxed in
as is attributable to
the
that
fixed base.
2.
The term
independent
"professional services" includes
scientific,
teaching activities
physicians,
literary,
as well
lawyers,
artistic,
as the
engineers,
especially
educational
independent activities
architects,
dentists
or
of
and
accountants.
Article 15
DEPENDENT PERSONAL SERVICES
1.
Subject to the provisions
o f Articles 16, 18, 19
20, salaries, wages and other similar remuneration derived by
resident of
a Contracting
shall be taxable
only in
State in
respect of
a
employment
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.
that State unless
an
and
2.
Notwithstanding
remuneration derived by
respect of
the
provisions
a resident
an employment
of a
exercised
of
paragraph
1,
Contracting State
in the
other
in
Contracting
State shall be taxable only in the first-mentioned State if:
a1
the recipient
i s present
period o r periods not
days in any twelve
in the
other State
for
exceeding in the aggregate
month period commencing or
a
183
ending
in the fiscal year concerned, and
b1
the remuneration
is
paid b y ,
or
on behalf
of,
an
employer who is not a resident o f the other State, and
c1
the
remuneration
is
not
establishment o r a fixed
borne
by
a
permanent
base which the employer
has
in the other State.
3.
Article,
Notwithstanding
remuneration
exercised aboard
operated
in
a
the
derived
ship,
in which
in
provisions
respect
aircraft o r
international
Contracting State
preceding
traffic
an
be
taxed
o f effective
this
employment
road transport
may
the place
of
of
vehicle
in
the
management
o f the enterprise is situated.
Article 16
DIRECTORS ' FEES
Directors' fees and other similar payments derived
by
a resident o f a Contracting State in his capacity a s a member of
'the
board
o f directors of a company which i s a resident of the
other Contracting State may be taxed in that other State.
Article 17
A R T I S T E S AND SPORTSMEN
Notwithstanding the provisions of Articles
1.
income derived
entertainer,
by
a resident
such
as
television artiste,
his
personal
a
or
of
a Contracting
theatre,
motion
a musician,
activities
or
such
as
State
picture,
as a
and
14
15,
as
an
radio
or
sportsman,
exercised
in
the
from
other
Contracting State, may be taxed in that other State.
2.
Where
income
in
exercised by an entertainer
respect
of
personal
o r a sportsman
activities
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
which
the
activities
of
the
entertainer
or
in
sportsman
are
exercised.
3.
of this
Notwithstanding the provisions
Article,
income mentioned
exempt from tax in the
in
of paragraphs 1 and
this Article
Contracting State in which the
shall
this State or of
under
a
the other State or
cultural
Contracting States.
agreement
or
be
activity
of the entertainer or sportsman i s exercised provided that
activity i s supported for the most
this
part out of public funds
the activity is
arrangement
2
of
exercised
between
the
A r t i c l e 18
PENSIONS
Subject to the
2 of
provisions of paragraph
19, pensions and other similar
remuneration paid to a
Article
resident
of a Contracting State in consideration o f past employment shall
be taxable only in that State.
A r t i c l e 19
GOVERNMENT SERVICE
1.
a]
Salaries,
wages
and
other
similar
remuneration,
other than a pension, paid by a Contracting State or a
political or
administrative
subdivision or
authority thereof
to
an
individual
services rendered
to
that State
local
respect
of
subdivision
or
in
or
a
authority shall be taxable only in that State;
bl
However,
such
remuneration
salaries,
shall
Contracting State
that
State
and
be
if
the
wages
taxable
and
only
the services
individual
other
is
in
similar
the
other
are
rendered
in
a
resident
of
that State who:
il
is a national of that State; o r
iil
did not become
a resident of
that State
f o r the purpose of rendering the services.
solely
2.
a1
Any p e n s i o n paid b y ,
Contracting State
subdivision
or
i n d i v i d u a l in
State or
o r out
or
a
of
f u n d s c r e a t e d by,
a political
local
or
authority
respect of
administrative
thereof
services rendered
subdivision or
a
a u t h o r i t y shall
to
an
to
be
that
taxable
only in that S t a t e .
bl
H o w e v e r , such
other
pension shall
Contracting
State
be t a x a b l e
if
the
only in
individual
the
is
a
r e s i d e n t o f , and a n a t i o n a l o f , that S t a t e .
3.
The provisions
of A r t i c l e s
IS, 16, 17
and 18
shall
a p p l y t o s a l a r i e s , w a g e s and o t h e r s i m i l a r r e m u n e r a t i o n , and
p e n s i o n s , in r e s p e c t o f s e r v i c e s
business carried on
by a
r e n d e r e d in c o n n e c t i o n with
Contracting State or
a political
to
a
or
a d m i n i s t r a t i v e s u b d i v i s i o n o r a local a u t h o r i t y t h e r e o f .
Article 2 0
PROFESSORS AND RESEARCHERS
1.
r e s e a r c h by
Remuneration
an
received
individual who
for
is
teaching
or was
or
scientific
immediately
before
v i s i t i n g a C o n t r a c t i n g S t a t e a r e s i d e n t of t h e o t h e r C o n t r a c t i n g
S t a t e and w h o is present
exceeding two years
in the first S t a t e d u r i n g a period
f o r the purpose
of s c i e n t i f i c r e s e a r c h
f o r t e a c h i n g at a u n i v e r s i t y , c o l l e g e , e s t a b l i s h m e n t f o r
education, research
shall be exempt f r o m
institute
or o t h e r
tax in the first
such e n t i t i e s have non-profitmaking
not taxed in the o t h e r S t a t e .
similar
not
or
higher
establishment
S t a t e provided that
p u r p o s e s and the income
all
is
2.
The provision of paragraph 1 shall not apply to income
from research if such research
interest but primarily
is undertaken not in the
f o r the
private benefit
of a
public
specific
person o r persons.
Article 2 1
STUDENTS
Payments which a student or business apprentice who is
or
was
immediately
before
resident of the other
the
first-mentioned
education
or
a
Contracting
Contracting State and
State
training
solely
receives
maintenance, education or
State, provided that
visiting
for
for
who is present
the
the
training shall not
such payments arise
State
a
in
purpose
of
his
purpose
of
his
be taxed in
that
from sources
outside
that State.
Article 22
OTHER INCOME
1.
Items o f income of a resident of a Contracting
wherever arising, not
dealt with in
State,
the foregoing Articles
of
this Convention shall be taxable only in that State.
2.
The
provisions
of paragraph
apply
to
income, other than income from immovable property as defined
in
1
shall not
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
situated therein, o r
a
permanent
performs in that
personal services f r o m
right o r property
through
a fixed base
in respect
establishment
other State
independent
situated therein, and
o f which
the income
i s paid
the
is
effectively connected with such permanent establishment o r fixed
base. I n such case the provisions o f Article 7 or Article 14, a s
the case may b e , shall a p p l y .
CHAPTER I V
E L I M I N A T I O N O F DOUBLE T A X A T I O N
A r t i c l e 23
METHODS FOR E L I M I N A T I O N O F DOUBLE T A X A T I O N
The double taxation shall be eliminated a s follows:
a)
I n the c a s e of a resident o f Poland:
(i)
Where a resident of Poland derives income
in
accordance
Convention
may
with
be
the
taxed
shall, subject to the
provisions
in
which,
of
Portugal,
this
Poland
provisions o f subparagraph
C i i l , exempt such income from tax. Poland may
calculating the amount
income of
such resident
o f tax
on the
apply the
income had not been s o exempted;
remaining
rate of
which would have been applicable if the
in
tax
exempted
(ii] W h e r e a
resident
of
Poland
derives
items
of
i n c o m e w h i c h in a c c o r d a n c e w i t h t h e p r o v i s i o n s o f
A r t i c l e s 10, 1 1 a n d 1 2 , m a y b e t a x e d i n P o r t u g a l ,
P o l a n d s h a l l a l l o w a s a d e d u c t i o n f r o m t h e tax o n
the income of
that resident an
t h e i n c o m e t a x paid
amount equal
in P o r t u g a l . S u c h
deduction
shall not, h o w e v e r , exceed that part o f the
tax,
as computed before the deduction is given,
is attributable to such
to
items of income
which
derived
from Portugal; and
(iii]
Where
in
accordance
with any provision
o f the
C o n v e n t i o n i n c o m e d e r i v e d by a r e s i d e n t o f P o l a n d
is e x e m p t . from.tax
in
this State,
Poland
may
n e v e r t h e l e s s , i n c a l c u l a t i n g t h e a m o u n t o f t a x on
the remaining income o f such r e s i d e n t , take
into
account the exempted i n c o m e ;
b]
I n the c a s e of a resident o f Portugal:
(i]
Where
a
resident
of
Portugal
derives
income
w h i c h , in a c c o r d a n c e w i t h t h e p r o v i s i o n s o f
C o n v e n t i o n , may
be
taxed
in
Poland,
shall allow as
a deduction from
i n c o m e o f that
resident an amount
i n c o m e tax paid in
this
Portugal
the tax on
the
equal to
the
Poland; such deduction
n o t , h o w e v e r , e x c e e d t h a t part o f t h e i n c o m e
shall
tax
as computed before the deduction is given,
which
i s a t t r i b u t a b l e t o t h e i n c o m e w h i c h may be
taxed
in P o l a n d ; and
(ii) Where in
accordance with
Convention
Portugal
income
is
Portugal may
amount of
any provision
derived
exempt
from
tax
nevertheless,
tax on
by
in
a
of
the
resident
of
in
this
State,
calculating
the
income of
such
the remaining
resident, take into account the exempted income.
CHAPTER V
SPECIAL PROVISIONS
Article 24
NON-DISCRIMINATION
Nationals
not
be
subjected in the other Contracting State to any taxation or
any
1.
requirement
of
connected
a
Contracting
therewith,
State
which
is
shall
other
or
more
burdensome than the taxation and connected requirements to which
nationals o f
that
other State
in the
particular with respect to residence,
same circumstances,
are o r may be
subjected.
This provision shall, notwithstanding the provisions o f
1,
in
Article
also apply to persons who are not residents o f one or both o f
the Contracting States.
2.
The
taxation on
a permanent
enterprise o f a Contracting State
State shall not be
than the
has in the other
less favourably levied
taxation levied
carrying on the
establishment which
on enterprises
same activities.
Contracting
in that other
of that
This provision
an
other
State
State
shall not
construed a s obliging a Contracting State to grant to
be
residents
of the other Contracting State any personal allowances,
and reductions for taxation purposes on
reliefs
account of civil status
or family responsibilities which it grants to its own residents.
3.
9,
Except where the provisions of paragraph 1 of
paragraph 7
11,
of Article
apply, interest, royalties and
enterprise of a
or
other
Contracting State
Contracting State
shall, for
paragraph 6
the
Article
12,
of Article
disbursements paid by
to a resident
purpose of
of the
an
other
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.
4.
which is
Enterprises
wholly
or partly
indirectly, by one
State, shall
not
of a
Contracting State,
owned
or controlled,
or more residents
be
subjected in
the capital
directly
of the other
the
or
more
requirements
to
burdensome
which
than
other
the
first-mentioned
similar
taxation
or
Contracting
State
to any taxation or any requirement connected therewith which
other
of
and
enterprises
is
connected
of
the
first-mentioned State are or may be subjected.
5.
The provisions of this Article shall,
the provisions of Article
description.
2, apply to taxes
notwithstanding
of every kind
and
Article 25
MUTUAL AGREEMENT PROCEDURE
actions of one
or
both of the Contracting States result or will result for him
in
1.
taxation
Where a person
not
in
considers that the
accordance
with
the
provisions
of
this
Convention, 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 o r ,
if his case comes
under paragraph 1 o f
the Contracting State of which he
be presented within three years
the action
resulting in
Article 24, to that
i s a national. The case
of
must
from the first notification
taxation not
in accordance
with
of
the
provisions of the Convention.
2.
The
competent
authority
shall
endeavour,
if
objection appears to it to be justified and if it i s not
the
itself
I
1
I
'
able to arrive at a
satisfactory solution, to resolve the
by mutual agreement
with the competent
Contracting State,
which is not
with a
view to
in accordance with
authority of the
the avoidance
of
the Convention. Any
case
other
taxation
agreement
reached shall be implemented notwithstanding any time limits
in
the domestic law of the Contracting States.
3.
The competent
authorities of
shall endeavour to resolve
the Contracting
by mutual agreement any
States
dificulties
or doubts arising as to the interpretation or application of the
Convention. They may also
consult together for the
elimination
I
of double taxation in cases not provided for in the Convention.
4.
The competent
may c o m m u n i c a t e with
joint
a u t h o r i t i e s of
the Contracting
each o t h e r d i r e c t l y ,
commission
consisting
of
States
including through
themselves
or
a
their
r e p r e s e n t a t i v e s , f o r the purpose of r e a c h i n g an agreement in the
sense o f the preceding paragraphs.
A r t i c l e 26
EXCHANGE O F I N F O R M A T I O N
1.
The competent
a u t h o r i t i e s of
the C o n t r a c t i n g
States
shall e x c h a n g e such information a s is necessary f o r carrying out
the provisions o f this C o n v e n t i o n o r o f the d o m e s t i c laws o f the
Contracting States concerning
insofar a s
the
Convention.
taxation
taxes covered
t h e r e u n d e r is
The exchange
by the
not
of information i s
Convention
contrary
to
not restricted
the
by
A r t i c l e 1 . Any information received by a C o n t r a c t i n g State shall
be treated as secret in the same m a n n e r a s information
under the d o m e s t i c
only
to
laws of
persons
administrative
or
bodies)
that S t a t e and
authorities
concerned
shall be
(including
with
the
c o l l e c t i o n o f , the enforcement o r prosecution
the d e t e r m i n a t i o n o f a p p e a l s in
by the C o n v e n t i o n .
i n f o r m a t i o n only
information
in
Such persons
for
public
such
court
disclosed
courts
assessment
and
or
in respect o f , o r
r e l a t i o n t o , the t a x e s
or authorities
purposes.
obtained
They
may
proceedings
or
covered
shall use
the
disclose
the
in
judicial
decisions.
2.
In
no c a s e
shall the
provisions of
paragraph 1
be
c o n s t r u e d so a s to impose on a C o n t r a c t i n g S t a t e t h e obligaticw:
a)
to carry out administrative measures at variance
with
the laws and administrative practice of that o r o f the
other Contracting S t a t e ;
b)
to supply information
which i s
not obtainable
under
the laws or in the normal course o f the administration
o f that or o f the other Contracting S t a t e ;
to supply information which would disclose any
c)
business,
secret
industrial,
or
trade
commercial
process,
or
or
trade,
professional
information,
the
disclosure o f which would be contrary to public policy
(
ordre public)
.
A r t i c l e 27
MEMBERS O F D I P L O M A T I C M I S S I O N S AND CONSULAR P O S T S
Nothing in
this Convention
shall affect
the
fiscal
privileges o f members o f diplomatic missions and consular
under the
general
rules
o f international
law
or
posts
under
the
provisions of special agreements.
CHAPTER V I
FINAL PROVISIONS
A r t i c l e 28
ENTRY I N T O FORCE
1.
of
This Convention shall be ratified and the
ratification
possible.
shall
be
exchanged
at
A+.?%?!
instruments
as
soon
as
2.
The
Convention
shall
enter
into
force
upon
the
exchange of instruments of ratification and its provisions shall
have effect:
a]
in respect
of
giving rise to
taxes
withheld at
them appearing on
source,
the
or after the
fact
first
day of January of the year next following the year
in
which this Convention enters into force; and
b]
in respect of other taxes a s to income arising in
fiscal year beginning
on or
January in the year next
after the
any
first day
following the year in
of
which
this Convention enters into force.
Article 29
TERMINATION
This Convention shall remain in force until terminated
by a Contracting State.
Either Contracting State may
terminate
the Convention, through diplomatic channels, by giving notice o f
termination at least six months
before the end of any
calendar
year following after the period of five years from the date
which the
Convention
enters
into force.
In
on
such
event
the
source,
the
fact
Convention shall cease to have effect:
a)
in respect
of
giving rise to
taxes
withheld at
them appearing on
or after the
first
day of January in the year next following the date
on
which the
of
period
specified
termination expires; and
in the
said
notice
bl
in respect of other taxes a s to income arising in
the fiscal year beginning
day of
January in
date on which
on or after the
the year
next following
the period specified
in the
first
the
said
notice of termination expires.
In
witness
whereof
the
undersigned,
duly
authorized thereto, have signed this Convention.
in two originals,
languages, the
of any
prevail.
each in
three texts
divergence of
the English,
being
Polish and
Portuguese
equally authentic.
interpretation, the
English
In
text
case
shall