S.I. No. 30/1988 - Double Taxation Relief (Taxes on Income and Capital Gains) (New Zealand) Order, 1988.

1. The competent authorities of the Contracting States shall exchange such information as is necessary for carrying out the provisions of this Convention or of the domestic laws of the Contracting States concerning taxes covered by the Convention insofar as the taxation thereunder is not contrary to the Convention. The exchange of information is not restricted by Article 1 (Personal Scope). 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) involved in the assessment or collection of, the enforcement or prosecution in respect of, or the determination of appeals in relation to, the taxes covered by the Convention. 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 of this Article 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.

ARTICLE 28

Diplomatic and Consular Officers

Nothing in this Convention shall affect the fiscal privileges of diplomatic or consular officers under the general rules of international law or under the provisions of special international agreements.

ARTICLE 29

Entry into Force

Each of the Contracting States shall notify to the other the completion of the procedures required by its law for the bringing into force of this Convention. The Convention shall enter into force on the date of the later of these notifications and shall thereupon have effect

(

a

) in New Zealand: for any income year beginning on or after 1 April next following the date on which the Convention enters into force;

(

b

) in Ireland

(i) in respect of income tax and capital gains tax, for any year of assessment beginning on or after the sixth day of April next following the date on which the Convention enters into force;

(ii) in respect of corporation tax, for any financial year beginning on or after the first day of January next following the date on which the Convention enters into force.

ARTICLE 30

Termination

This Convention shall remain in force until terminated by a Contracting State. Either Contracting State may terminate the Convention, through diplomatic channels, at any time after five years from the date on which the Convention enters into force provided that at least six months prior notice of termination has been given.

In such event, the Convention shall cease to have effect

(

a

) in New Zealand: for any income year beginning on or after 1 April next following the date on which the period specified in the said notice of termination expires

(

b

) in Ireland

(i) in respect of income tax and capital gains tax, for any year of assessment beginning on or after the sixth day of April next following the date on which the period specified in the said notice of termination expires;

(ii) in respect of corporation tax, for any financial year beginning on or after the first day of January next following the date on which the period specified in the said notice of termination expires.

IN WITNESS WHEREOF the undersigned, duly authorised thereto, have signed the present Convention.

DONE in duplicate at Dublin this 19th day of September 1986 in the English language.

GEORGE BERMINGHAM

F.D. O'FLYNN

For the Government of

For the Government of

Ireland

New Zealand

GIVEN under the Official Seal of the Government, this 23rd day of February, 1988.

CHARLES J. HAUGHEY,

Taoiseach.

EXPLANATORY NOTE.

This Order gives the force of law to the Convention with New Zealand which is set out in the Schedule. The effect of the Convention is summarised below.

It allocates the right, though not necessarily the exclusive right, to tax some income such as interest and royalties to the country of source, sometimes at limited rates, while the country of residence is given the sole right to tax other classes of income. Such income as trading profits not arising through a permanent establishment, profits from the operation of ships or aircraft in international traffic, pensions (other than governmental or social welfare pensions) and annuities is taxable only in the country of residence. On the other hand, remuneration and pensions in respect of services rendered to a government of one of the countries are normally taxable only in that country, i.e., the country of source. Double taxation may also be avoided where the domestic law of one of the countries frees income from its tax.

The Convention contains provisions to the effect that, where income may be taxed in both countries, the country of residence, if it taxes, is to allow a credit against its own tax for the tax imposed on the same income by the country of source.

The Convention provides that where a company which is a resident of Ireland pays a dividend to a resident of New Zealand (other than a company which controls, directly or indirectly, 10 per cent or more of the voting power in the paying company) the recipient is, subject to certain conditions, to receive the tax credit to which an individual resident in Ireland would have been entitled had he received that dividend. In such circumstances tax at a rate not exceeding 15 per cent on the aggregate of the dividend and the tax credit may be charged in Ireland.

New Zealand domestic law provides that dividends received from abroad by New Zealand resident companies are exempted from a charge to New Zealand tax. The benefit of the Irish tax incentive reliefs will, therefore, be preserved for dividends paid by an Irish resident company out of relieved profits to a New Zealand resident company. Paragraph 1 (

b

) of Article 24 provides that should New Zealand domestic law in this regard be changed provisions will be negotiated between the two countries concerning the taxation of dividends derived from sources in Ireland.

In the case of dividends paid by a company which is a resident of New Zealand to a resident of Ireland the Convention provides that New Zealand withholding tax is not to exceed 15 per cent of the gross amount of the dividend.

Income or gains from the alienation of immovable property (as defined) may be taxed in the country in which the property is situated. Subject to this provision, income or gains from the alienation by a resident of one country of (

a

) capital assets or (

b

) ships or aircraft operated in international traffic will be taxable only in the country of residence. However, where those capital assets form part of the business assets of a permanent establishment or fixed base in the other country the income or gains may be taxed in that other country.

Provision is made for consultation between the competent authorities of the two countries for the purpose of resolving any difficulties or doubts arising as to the interpretation or application of the Convention and for the exchange of such information between those authorities as is necessary for the carrying out of the Convention.

The Convention will be effective in Ireland as follows:—

(i) in respect of income tax and capital gains tax, for any year of assessment beginning on or after the sixth day of April next following the year in which the Convention enters into force;

(ii) in respect of corporation tax, for any financial year beginning on or after the first day of January next following the year in which the Convention enters into force.

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 Convention. They may also consult together for the elimination of double taxation in cases not provided for in the Convention.

4. The competent authorities of the Contracting States may communicate with each other directly for the purpose of giving effect to the provisions of the Convention.

ARTICLE 27

Exchange of Information

5. This Article shall not apply to any provision of the taxation law of a Contracting State which

(

a

) is reasonably designed to prevent or defeat the avoidance or evasion of taxes and which is in force on the date of signature of this Convention; or

(

b

) is substantially similar in general purpose or intent to any such provisions but is enacted after that date; provided that any such provision (except where that provision is in an international agreement) does not allow for different treatment of residents or nationals of the other Contracting State as compared with the treatment of residents or nationals of any third State.

6. Nothing in this Article shall be construed as preventing a Contracting State from distinguishing in its taxation law between residents and non-residents solely on the basis of their residence and to levy taxes or grant exemption, relief, reduction or allowance for tax purposes accordingly.

7. In this Article the term "taxation" means the taxes to which this Convention applies and the term "taxation law" shall be construed accordingly.

ARTICLE 26

Mutual Agreement Procedure

8. For the purposes of this Article the term "gains" means, in the case of Ireland, chargeable gains as defined in the taxation law of Ireland.

ARTICLE 16

Independent Personal Services

S.I. No. 30 of 1988.

DOUBLE TAXATION RELIEF (TAXES ON INCOME AND CAPITAL GAINS) (NEW ZEALAND) ORDER, 1988.

WHEREAS it is enacted by

section 361

(1) of the

Income Tax Act, 1967

(No. 6 of 1967), as amended by

section 86

of the

Finance Act, 1974

(No. 27 of 1974),

section 38

(1) of the

Capital Gains Tax Act, 1975

(No. 20 of 1975),

section 166

of the

Corporation Tax Act, 1976

(No. 7 of 1976), and

section 47

(4) of the

Finance Act, 1983

(No. 15 of 1983), that if the Government by order declare that arrangements specified in the order have been made with the government of any territory outside the State in relation to affording relief from double taxation in respect of income tax, corporation tax or capital gains tax and any taxes of a similar character, imposed by the laws of the State or by the laws of that territory, and that it is expedient that those arrangements should have the force of law, the arrangements shall, notwithstanding anything in any enactment other than

section 47

of the

Finance Act, 1983

, have the force of law

AND WHEREAS it is further enacted by section 361 (6) of that Act that where such an order is proposed to be made, a draft thereof shall be laid before Dáil Éireann and the order shall not be made until a resolution approving of the draft has been passed by Dáil Éireann

AND WHEREAS a draft of this Order has been laid before Dáil Éireann and a resolution approving of the draft has been passed by Dáil Éireann

NOW, the Government, in exercise of the powers conferred on them by

section 361

of the

Income Tax Act, 1967

(No. 6 of 1967), as amended by

section 38

(1) of the

Capital Gains Tax Act, 1975

(No. 20 of 1975),

section 166

of the

Corporation Tax Act, 1976

(No. 7 of 1976), and

section 47

(4) of the

Finance Act, 1983

(No. 15 of 1983), hereby order as follows