Double Taxation Relief (Taxes on Income) (ln_2020_28) | MT

Malta Government Gazette — Legal Notice 2020 28 · Gazzetta tal-Gvern ta’ Malta Nru. 20,350 - 20.02.2020 — Double Taxation Relief (Taxes on Income)

Preamble — Double Taxation Relief (Taxes on Income) Open official source

L.N. 28 of 2020

INCOME TAX ACT

(CAP. 123)

Double Taxation Relief (Taxes on Income)

(The Republic of Armenia) Order, 2020

IN EXERCISE of the powers conferred by article 76 of the

Income Tax Act, the Minister for Finance and Financial Services, has

made the following Order:-

Malta Government Gazette — Legal Notice 2020 28 · Gazzetta tal-Gvern ta’ Malta Nru. 20,350 - 20.02.2020 — Double Taxation Relief (Taxes on Income)

Reg. 1 Citation. — Double Taxation Relief (Taxes on Income) Open official source

The title of this Order is Double Taxation Relief (Taxes on

Income) (The Republic of Armenia) Order, 2020.

Malta Government Gazette — Legal Notice 2020 28 · Gazzetta tal-Gvern ta’ Malta Nru. 20,350 - 20.02.2020 — Double Taxation Relief (Taxes on Income)

Schedule — Double Taxation Relief (Taxes on Income) Open official source

(Article 2)

AGREEMENT BETWEEN THE GOVERNMENT OF THE

REPUBLIC OF ARMENIA AND THE GOVERNMENT OF THE

REPUBLIC OF MALTA

FOR THE ELIMINATION OF DOUBLE TAXATION WITH

RESPECT TO TAXES ON INCOME AND THE PREVENTION OF

TAX EVASION AND AVOIDANCE

The Government of the Republic of Armenia and the Government

of the Republic of Malta,

Desiring to further develop their economic relationship and to

enhance their co-operation in tax matters

Intending to conclude an Agreement for the elimination of double

taxation with respect to the taxes on income without creating

opportunities for non-taxation or reduced taxation through tax

evasion or avoidance (including through treaty-shopping

arrangements aimed at obtaining reliefs provided in this Agreement

for the indirect benefit of residents of third States), 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 imposed on

behalf of a Contracting State irrespective of the manner in which they

are levied.

2. There shall be regarded as taxes on income all taxes

imposed on total income, or on elements of income, including taxes on

gains from the alienation of movable or immovable property and taxes

on the total amounts of wages or salaries paid by enterprises.

Malta Government Gazette — Legal Notice 2020 28 · Gazzetta tal-Gvern ta’ Malta Nru. 20,350 - 20.02.2020 — Double Taxation Relief (Taxes on Income)

Reg. 2 Arrangements to have effect. — Double Taxation Relief (Taxes on Income) Open official source

It is hereby declared

(a) that the arrangements specified in the Agreement set

out in the Schedule (hereinafter referred to as "the Agreement")

have been made with the Government of the Republic of

Armenia with a view to affording relief from double taxation in

relation to the following tax imposed by the laws of the

Government of the Republic of Armenia

(i)

the profit tax; and

(ii)

the income tax;

(b) that it is expedient that those arrangements shall have

effect following the entry into force of the Agreement and in

accordance with the relevant provisions of the Agreement;

(c) that the Agreement shall enter into force on such date

as announced by notice in the Gazette.

Gazzetta tal-Gvern ta' Malta — Avviż Legali 2020 28 · Gazzetta tal-Gvern ta’ Malta Nru. 20,350 - 20.02.2020 — Ordni tal-2020 dwar Ħelsien minn Taxxa Doppja

Schedule — Ordni tal-2020 dwar Ħelsien minn Taxxa Doppja Open official source

(Article 2)

AGREEMENT BETWEEN THE GOVERNMENT OF THE

REPUBLIC OF ARMENIA AND THE GOVERNMENT OF THE

REPUBLIC OF MALTA

FOR THE ELIMINATION OF DOUBLE TAXATION WITH

RESPECT TO TAXES ON INCOME AND THE PREVENTION OF

TAX EVASION AND AVOIDANCE

The Government of the Republic of Armenia and the Government

of the Republic of Malta,

Desiring to further develop their economic relationship and to

enhance their co-operation in tax matters

Intending to conclude an Agreement for the elimination of double

taxation with respect to the taxes on income without creating

opportunities for non-taxation or reduced taxation through tax

evasion or avoidance (including through treaty-shopping

arrangements aimed at obtaining reliefs provided in this Agreement

for the indirect benefit of residents of third States), 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 imposed on

behalf of a Contracting State irrespective of the manner in which they

are levied.

2. There shall be regarded as taxes on income all taxes

imposed on total income, or on elements of income, including taxes on

gains from the alienation of movable or immovable property and taxes

on the total amounts of wages or salaries paid by enterprises.

3. The existing taxes to which the Agreement shall apply are

in particular

(a)

in Malta

the income tax;

(hereinafter referred to as "Malta tax");

(b)

in Armenia

(i)

the profit tax; and

(ii) the income tax;

(hereinafter referred to as "Armenian 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) the terms "a Contracting State" and "the other

Contracting State" mean, as the context requires, Armenia or

Malta;

(b) the term "Armenia" means the Republic of Armenia

and, when used in the geographical sense, means the territory,

including land, waters, subsoil and air spaces upon which the

Republic of Armenia exercises its sovereign rights and

jurisdiction according to national legislation and international

law;

(c) the term "Malta" means the Republic of Malta and,

when used in a geographical sense, means the Island of Malta,

the Island of Gozo and the other islands of the Maltese

archipelago including the territorial waters thereof, as well as

any area of the sea-bed, its subsoil and the superjacent water

column adjacent to the territorial waters, wherein Malta

exercises sovereign rights, jurisdiction, or control in accordance

with international law and its national law, including its

legislation relating to the exploration of the continental shelf and

exploitation of its natural resources;

(d) the term "person" includes an individual, a collective

investment scheme, a company and any other body of persons;

(e)

the term "company" means any body corporate or any

entity that is treated as a body corporate for tax purposes;

(f) the term "enterprise" applies to the carrying on of any

business;

(g) 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;

(h) 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;

(i) the term "business" includes the performance of

professional services and of other activities of an independent

character;

(j)

the term "competent authority" means

(i) in Malta: the Minister responsible for finance or

his authorised representative;

(ii) in Armenia: the Minister of Finance and the

Chairman of State Revenue Committee or their authorised

representatives;

(k)

the term "national", in relation to a Contracting State,

means

(i) any individual possessing the nationality of that

Contracting State;

(ii) any legal person, partnership or association

deriving its status as such from the laws in force in that

Contracting State.

2. As regards the application of the Agreement at any time by

a Contracting State, any term not defined therein shall, unless the

context otherwise requires, have the meaning that it has at that time

under the law of that State for the purposes of the taxes to which the

Agreement applies, any meaning under the applicable tax laws of that

State prevailing over a meaning given to the term under other laws of

that State.

ARTICLE 4

Resident

1. For the purposes of this Agreement, the term "resident of a

Contracting State" means any person who, under the laws of that State,

is liable to tax therein by reason of his domicile, residence, place of

incorporation, place of management or any other criterion of a similar

nature, and also includes that State. 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.

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 both States or of neither of them,

the competent authorities of the Contracting States shall settle

the question by mutual agreement.

3. Where by reason of the provisions of paragraph 1 a person

other than an individual is a resident of both Contracting States, then it

shall be deemed to be a resident only of the State in which its place of

effective management is situated. Where there is a dispute between the

competent authorities as to where the effective management of such

person is situated, and agreement cannot be reached between the

competent authorities, then it shall be deemed that such a person is a

resident only of the State in which it is incorporated.

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 or extraction of natural resources.

3. (a) A building site or construction, assembly, or

installation project or supervisory activities in connection therewith,

constitutes a permanent establishment but only where such site, project

or activities continue for a period of more than 9 months.

(b) The furnishing of services, including consultative

services, by an enterprise through employees or other personnel

engaged by the enterprise for such purpose constitutes a

permanent establishment but only where activities of that nature

continue (for the same or connected project) within the country

for a period or periods aggregating more than 6 months within

any twelve-month period.

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 sub-paragraphs

(a) to (e), provided that the overall activity of the fixed place of

business resulting from this combination is of a preparatory or

auxiliary character.

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.

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; ships and aircraft shall not be regarded as

immovable property.

3. The provisions of paragraph 1 shall apply to income

derived from the direct use, letting, or use in any other form of

immovable property.

4. The provisions of paragraphs 1 and 3 shall also apply to the

income from immovable property of an enterprise.

ARTICLE 7

Business Profits

1. The profits of an enterprise of a Contracting State shall be

taxable only in that State unless the enterprise carries on business in

the other Contracting State through a permanent establishment situated

therein. If 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. It is

understood that the expenses to be allowed as deductions by a

Contracting State shall include only expenses that are deductible under

the domestic laws of that State.

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

1. Profits of an enterprise of a Contracting State from the

operation of ships or aircraft in international traffic shall be taxable

only in that State.

2. For the purposes of this Article, profits derived from the

operation of ships or aircraft in international traffic include profits

derived from the rental of ships or aircraft if such ships or aircraft are

operated in international traffic or if such rental profits are incidental

to other profits described in paragraph 1 of this Article.

3. The provisions of paragraph 1 shall also apply to 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 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, where that other State considers the

adjustment justified. 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 -

(a) where the dividends are paid by a company which is a

resident of Armenia to a resident of Malta who is the beneficial

owner thereof, the tax so charged in Armenia shall not exceed

(i) 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 10 per cent of the

capital of the company paying the dividends and has

invested at least one and a half million euro (or the

equivalent amount in any other currency) in the share

capital of the company paying the dividends at the date of

payment of the dividends;

(ii) 10 per cent of the gross amount of the dividends

in all other cases;

(b) where the dividends are paid by a company which is a

resident of Malta to a resident of Armenia who is the beneficial

owner thereof, Malta tax on the gross amount of the dividends

shall not exceed that chargeable on the profits out of which the

dividends are paid.

The competent authorities of the Contracting States shall by mutual

agreement settle the mode of application of these limitations. 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 or other rights, not being debt-claims, participating in

profits, as well as income from other corporate rights 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 and the holding in respect of which the

dividends are paid is effectively connected with such permanent

establishment. In such case the provisions of Article 7 shall apply.

5. Where a company which is a resident of a Contracting State

derives profits or income from the other Contracting State, that other

State may not impose any tax on the dividends paid by the company,

except insofar as such dividends are paid to a resident of that other

State or insofar as the holding in respect of which the dividends are

paid is effectively connected with a permanent establishment situated

in that other State, nor subject the company's undistributed profits to a

tax on the company's undistributed profits, even if the dividends paid

or the undistributed profits consist wholly or partly of profits or

income arising in such other State.

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 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 percent of the

gross amount of the interest.

The competent authorities of the Contracting States shall by mutual

agreement settle the mode of application of this limitation.

3. 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.

4. 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 and

the debt-claim in respect of which the interest is paid is effectively

connected with such permanent establishment. In such case the

provisions of Article 7 shall apply.

5. 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 in

connection with which the indebtedness on which the interest is paid

was incurred, and such interest is borne by such permanent

establishment, then such interest shall be deemed to arise in the State

in which the permanent establishment is situated.

6. Where, by reason of a special relationship between the

payer and the beneficial owner or between both of them and

some other person, the amount of the 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 recipient is the beneficial owner of the royalties, the

tax so charged shall not exceed 5 percent of the gross amount of the

royalties.

The competent authorities of the Contracting States shall by mutual

agreement settle the mode of 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 of, or the right to

use, any copyright of literary, artistic or scientific work including

cinematographic films or films or tapes used for radio or television

broadcasting, any patent, trade mark, design or model, plan, secret

formula or process or for information concerning industrial,

commercial or scientific experience.

4. The provisions of paragraphs 1 and 2 shall not apply if the

beneficial owner of the royalties, being a resident of a Contracting

State, carries on business in the other Contracting State in which the

royalties arise through a permanent establishment situated therein and

the right or property in respect of which the royalties are paid is

effectively connected with such permanent establishment. In such case

the provisions of Article 7 shall apply.

5. Royalties shall be deemed to arise in a Contracting State

when the payer is that State itself or 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 in connection with which the liability to pay the

royalties was incurred, and such royalties are borne by such permanent

establishment, then such royalties shall be deemed to arise in the

Contracting State in which the permanent establishment is situated.

6. Where, by reason of a special relationship between the

payer and the beneficial owner or between both of them and some

other person, the amount of the royalties, having regard to the use,

right or information for 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

including such gains from the alienation of such a permanent

establishment (alone or with the whole enterprise) may be taxed in that

other State.

3. Gains derived by an enterprise of a Contracting State from

the alienation of ships or aircraft operated in international traffic, or

from movable property pertaining to the operation of such ships or

aircraft shall be taxable only in that State.

4. Gains derived by a resident of a Contracting State from the

alienation of shares or comparable interests, such as interests in a

partnership or trust, may be taxed in the other Contracting State if, at

any time during the 365 days preceding the alienation, these shares or

comparable interests derived more than 50 per cent of their value

directly or indirectly from immovable property, as defined in Article 6,

situated in that other State.

5. Gains from the alienation of any property, other than that

referred to in paragraphs 1, 2, 3 and 4, shall be taxable only in the

Contracting State of which the alienator is a resident.

ARTICLE 14

Income from Employment

1. Subject to the provisions of Articles 15, 17 and 18, salaries,

wages and other similar remuneration derived by a resident of a

Contracting State in respect of an employment shall be taxable only in

that State unless the employment is exercised in the other Contracting

State. If the employment is so exercised, such remuneration as is

derived therefrom may be taxed in that other State.

2. Notwithstanding the provisions of paragraph 1,

remuneration derived by a resident of a Contracting State in respect of

an employment exercised in the other Contracting State shall be

taxable only in the first-mentioned State if

(a) the recipient is present in the other State for a period

or periods not exceeding in the aggregate 183 days in any

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 which the employer has in the other State.

3. Notwithstanding the preceding provisions of this Article,

remuneration derived in respect of an employment exercised aboard a

ship or aircraft operated in international traffic by an enterprise of a

Contracting State may be taxed in that State.

ARTICLE 15

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 16

Artistes And Sportsmen

1. Notwithstanding the provisions of Articles 7 and 14,

income derived by a resident of a Contracting State as an entertainer,

such as a theatre, motion picture, radio or television artiste, or a

musician, or as a 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 and 14, be taxed in

the Contracting State in which the activities of the entertainer or

sportsman are exercised.

3. Notwithstanding the provisions of paragraphs 1 and 2,

income derived by a resident of a Contracting State from his personal

activities as an entertainer or as a sportsman shall be taxable only in

that State if the activities are exercised in the other Contracting State

within the framework of a cultural or sports exchange program

approved by both Contracting States.

ARTICLE 17

Pensions

Subject to the provisions of paragraph 2 of Article 18, pensions and

other similar remuneration paid to a resident of a Contracting State

in consideration of past employment shall be taxable only in that

State.

ARTICLE 18

Government Service

1. (a) Salaries, wages and other similar remuneration paid

by a Contracting State to an individual in respect of services rendered

to that State shall be taxable only in that State.

(b) However, such salaries, wages and other similar

remuneration shall be taxable only in the other Contracting State

if the services are rendered in that State and the individual is a

resident of that State who

(i)

is a national of that State; or

(ii) did not become a resident of that State solely

for the purpose of rendering the services.

2. (a) Notwithstanding the provisions of paragraph 1,

pensions and other similar remuneration paid by, or out of funds

created by, a Contracting State to an individual in respect of services

rendered to that State shall be taxable only in that State.

(b) However, such pensions and similar remuneration

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 Articles 14, 15, 16 and 17 shall apply to

salaries, wages, pensions and other similar remuneration in respect of

services rendered in connection with a business carried on by a

Contracting State.

ARTICLE 19

Students

Payments which a student or business apprentice who is or was

immediately before visiting a Contracting State a resident of the

other Contracting State and who is present in the first-mentioned

State solely for the purpose of 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 20

Professors and Researchers

1. An individual who visits a Contracting State for the

purpose of teaching or carrying out research at a university, college,

school or other recognized educational institution in that State and who

is or was immediately before that visit a resident of the other

Contracting State, shall be exempt from taxation in the first-mentioned

Contracting State on remuneration for such teaching or research for a

period not exceeding two years from the date of his first visit for that

purpose, provided that such remuneration arise from sources outside

that State.

2. The provisions of paragraph 1 of this Article shall not apply

to remuneration from research if such research is undertaken not in the

public interest but primarily for the private benefit of a specific person

or persons.

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 and the right or

property in respect of which the income is paid is effectively

connected with such permanent establishment. In such case, the

provisions of Article 7 shall apply.

3. Notwithstanding the provisions of paragraph 1, if a

resident of a Contracting State derives income from sources within the

other Contracting State in the form of winnings from lotteries,

crossword puzzles, races including horse races, card games and other

games of any sort or gambling or betting of any form or nature

whatsoever, such income may be taxed in the other Contracting State.

ARTICLE 22

Elimination of Double Taxation

1. Where a resident of a Contracting State derives income

which, in accordance with the provisions of this Agreement, may be

taxed in the other Contracting State, the first-mentioned State shall

allow as a deduction from the tax on the income of that resident, an

amount equal to the income tax paid in that other State. Such

deduction, however, shall not exceed that part of the income tax, as

computed before the deduction is given, which is attributable to the

income which may be taxed in that other State.

2. Where in accordance with any provision of this Agreement,

income derived 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 of such resident, take into account the

exempted income.

ARTICLE 23

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. Stateless persons who are residents of a Contracting State

shall not be subjected in either 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 the

State concerned in the same circumstances, in particular with respect

to residence, are or may be subjected.

3. 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.

4. Except where the provisions of paragraph 1 of Article 9,

paragraph 6 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.

5. 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.

6. The provisions of this Article shall, notwithstanding the

provisions of Article 2, apply to taxes of every kind and description.

ARTICLE 24

Mutual Agreement Procedure

1. Where a person considers that the actions of one or both of

the Contracting States result or will result for that person in taxation

not in accordance with the provisions of the Agreement, he may,

irrespective of the remedies provided by the domestic law of those

States, present his case to the competent authority of either

Contracting State. 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, including through a joint

commission consisting of themselves or their representatives, for the

purpose of reaching an agreement in the sense of the preceding

paragraphs.

ARTICLE 25

Exchange of Information

1. The competent authorities of the Contracting States shall

exchange such information as is foreseeably relevant for carrying out

the provisions of this Agreement or to the administration or

enforcement of the domestic laws concerning taxes of every kind and

description imposed on behalf of the Contracting States insofar as the

taxation thereunder is not contrary to the Agreement. The exchange of

information is not restricted by Articles 1 and 2.

2. Any information received under paragraph 1 by a

Contracting State shall be treated as secret in the same manner as

information obtained under the domestic laws of that State and shall be

disclosed only to persons or authorities (including courts and

administrative bodies) concerned with the assessment or collection of,

the enforcement or prosecution in respect of, the determination of

appeals in relation to the taxes referred to in paragraph 1, or the

oversight of the above. Such persons or authorities shall use the

information only for such purposes. They may disclose the

information in public court proceedings or in judicial decisions.

3. In no case shall the provisions of paragraphs 1 and 2 be

construed so as to impose on a Contracting State the obligation

(a) to carry out administrative measures at variance with

the laws and administrative practice of that or of the other

Contracting State;

(b) to supply information which is not obtainable under

the laws or in the normal course of the administration of that or

of the other Contracting State;

(c) to supply information which would disclose any trade,

business, industrial, commercial or professional secret or trade

process, or information, the disclosure of which would be contrary to

public policy (ordre public).

4. If information is requested by a Contracting State in

accordance with this Article, the other Contracting State shall use its

information gathering measures to obtain the requested information,

even though that other State may not need such information for its own

tax purposes. The obligation contained in the preceding sentence is

subject to the limitations of paragraph 3 but in no case shall such

limitations be construed to permit a Contracting State to decline to

supply information solely because it has no domestic interest in such

information.

5. In no case shall the provisions of paragraph 3 be construed

to permit a Contracting State to decline to supply information solely

because the information is held by a bank, other financial institution,

nominee or person acting in an agency or a fiduciary capacity or

because it relates to ownership interests in a person.

ARTICLE 26

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 27

Entitlement to Benefits

Notwithstanding the other provisions of this Agreement, a

benefit under this Agreement shall not be granted in respect of an item

of income if it is reasonable to conclude, having regard to all relevant

facts and circumstances, that obtaining that benefit was one of the

principal purposes of any arrangement or transaction that resulted

directly or indirectly in that benefit, unless it is established that

granting that benefit in these circumstances would be in accordance

with the object and purpose of the relevant provisions of this

Agreement.

ARTICLE 28

Entry Into Force

1. The Contracting States shall notify each other, through

diplomatic channels, the completion of the procedures required by

their domestic law for entry into force of this Agreement.

2. This Agreement shall enter into force on the date of the

receipt of the later of these notifications and its provisions shall have

(a) in Malta, in respect of taxes on income derived during

any calendar year or accounting period, as the case may be,

beginning on or after the first day of January immediately

following the date on which the Agreement enters into force;

(b)

in Armenia

(i)

in respect of taxes withheld at source on

income derived on or after the first day of January in the

calendar year next following the year in which the

Agreement enters into force;

(ii) in respect of other taxes on income chargeable

for any tax year beginning on the first day of January in the

calendar year next following the year in which this

Agreement enters into force.

ARTICLE 29

Termination

This Agreement shall remain in force until terminated by a

Contracting State. Either Contracting State may terminate the

Agreement, through diplomatic channels, by giving notice of

termination at least six months before the end of any calendar year

beginning after the expiration of a period of five years from the date of

its entry into force. In such event, the Agreement shall cease to have

(a) in Malta in respect of taxes on income derived during

any calendar year or accounting period, as the case may be,

beginning on or after the first day of January immediately

following the date on which the notice is given;

(b)

in Armenia

(i) in respect of taxes withheld at source, on

income derived on or after the first day of January of the

calendar year next following that in which the notice of

termination is given; and

(ii) in respect of other taxes on income for taxable

years beginning on or after the first day of January of the

calendar year next following that in which the notice of

termination is given.

IN WITNESS WHEREOF the undersigned, being duly authorised

thereto by their respective Governments, have signed this

Agreement.

Done at New York on 24 September 2019 in two originals, in the

Armenian and English languages, both versions being equally

authentic. In case of divergence in interpretation, the English text

shall prevail.

For the Government of the

Republic of Malta

Republic of Armenia

Carmelo Abela

E.T. Zohrab Mnatsakanyan

Minister for Foreign Affairs and

Minister for Foreign Affairs

Trade Promotion

€2.07

Malta Government Gazette — Legal Notice 2020 28 · Gazzetta tal-Gvern ta’ Malta Nru. 20,350 - 20.02.2020 — Double Taxation Relief (Taxes on Income)

Reg. 3 — Double Taxation Relief (Taxes on Income) Open official source

The existing taxes to which the Agreement shall apply are

in particular

(a)

in Malta

the income tax;

(hereinafter referred to as "Malta tax");

(b)

in Armenia

(i)

the profit tax; and

(ii) the income tax;

(hereinafter referred to as "Armenian tax").

Malta Government Gazette — Legal Notice 2020 28 · Gazzetta tal-Gvern ta’ Malta Nru. 20,350 - 20.02.2020 — Double Taxation Relief (Taxes on Income)

Reg. 4 — Double Taxation Relief (Taxes on Income) Open official source

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) the terms "a Contracting State" and "the other

Contracting State" mean, as the context requires, Armenia or

Malta;

(b) the term "Armenia" means the Republic of Armenia

and, when used in the geographical sense, means the territory,

including land, waters, subsoil and air spaces upon which the

Republic of Armenia exercises its sovereign rights and

jurisdiction according to national legislation and international

law;

(c) the term "Malta" means the Republic of Malta and,

when used in a geographical sense, means the Island of Malta,

the Island of Gozo and the other islands of the Maltese

archipelago including the territorial waters thereof, as well as

any area of the sea-bed, its subsoil and the superjacent water

column adjacent to the territorial waters, wherein Malta

exercises sovereign rights, jurisdiction, or control in accordance

with international law and its national law, including its

legislation relating to the exploration of the continental shelf and

exploitation of its natural resources;

(d) the term "person" includes an individual, a collective

investment scheme, a company and any other body of persons;

(e)

the term "company" means any body corporate or any

entity that is treated as a body corporate for tax purposes;

(f) the term "enterprise" applies to the carrying on of any

business;

(g) 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;

(h) 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;

(i) the term "business" includes the performance of

professional services and of other activities of an independent

character;

(j)

the term "competent authority" means

(i) in Malta: the Minister responsible for finance or

his authorised representative;

(ii) in Armenia: the Minister of Finance and the

Chairman of State Revenue Committee or their authorised

representatives;

(k)

the term "national", in relation to a Contracting State,

means

(i) any individual possessing the nationality of that

Contracting State;

(ii) any legal person, partnership or association

deriving its status as such from the laws in force in that

Contracting State.

2. As regards the application of the Agreement at any time by

a Contracting State, any term not defined therein shall, unless the

context otherwise requires, have the meaning that it has at that time

under the law of that State for the purposes of the taxes to which the

Agreement applies, any meaning under the applicable tax laws of that

State prevailing over a meaning given to the term under other laws of

that State.

ARTICLE 4

Resident

1. For the purposes of this Agreement, the term "resident of a

Contracting State" means any person who, under the laws of that State,

is liable to tax therein by reason of his domicile, residence, place of

incorporation, place of management or any other criterion of a similar

nature, and also includes that State. 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.

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 both States or of neither of them,

the competent authorities of the Contracting States shall settle

the question by mutual agreement.

3. Where by reason of the provisions of paragraph 1 a person

other than an individual is a resident of both Contracting States, then it

shall be deemed to be a resident only of the State in which its place of

effective management is situated. Where there is a dispute between the

competent authorities as to where the effective management of such

person is situated, and agreement cannot be reached between the

competent authorities, then it shall be deemed that such a person is a

resident only of the State in which it is incorporated.

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 or extraction of natural resources.

3. (a) A building site or construction, assembly, or

installation project or supervisory activities in connection therewith,

constitutes a permanent establishment but only where such site, project

or activities continue for a period of more than 9 months.

(b) The furnishing of services, including consultative

services, by an enterprise through employees or other personnel

engaged by the enterprise for such purpose constitutes a

permanent establishment but only where activities of that nature

continue (for the same or connected project) within the country

for a period or periods aggregating more than 6 months within

any twelve-month period.

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 sub-paragraphs

(a) to (e), provided that the overall activity of the fixed place of

business resulting from this combination is of a preparatory or

auxiliary character.

Malta Government Gazette — Legal Notice 2020 28 · Gazzetta tal-Gvern ta’ Malta Nru. 20,350 - 20.02.2020 — Double Taxation Relief (Taxes on Income)

Reg. 5 — Double Taxation Relief (Taxes on Income) Open official source

Notwithstanding the provisions of paragraphs 1 and 2,