Section 16, The Income Tax (Deductions Citation

This Arrangement shall continue in effect indefinitely but either ofthe Governments may, on or before the 30th day of September in any calendar year after the year 1947, give notice of termination to the other Government and, in such event, this Arrangement shall cease to be effective- (a) in the United Kingdom as respects income tax for any year of assessment beginning on or after the 6th day of April in the calendar year next following that in which such notice is given; as respects surtax for any year of assessment beginning on or after the 6th day of April in the calendar year in which such notice is given; and as respects profits tax for any chargeable accounting period beginning on or after the 1st day of January in the calendar year next following that in which such notice is given and for the unexpired portion of any chargeable accounting period current at that date; (b) in the Colony, as respects Colonial tax for any year of assessment beginning on or after the lst day of April in the calendar year next following that in which such notice is given. Double Taxation Relief (Federation of Nigeria) [Cap. 273 THE FEDERATION OF NIGERIA. The Order which follows was made when the Federation of Nigeria was the Colony and Protectorate of Nigeria. THE DOUBLE TAXATION RELIEF (NIGERIA) ORDER. 1. This Order may be cited as the Double Taxation Relief (Nigeria) Order in Council, 1950. 2. It is hereby declaredset out in the Schedule to thjs Order have been made with the Government of Nigeria with a view to affording relief from double taxation in relation to tax and any tax of a similar character imposed by the laws of Nigeria; and (b) That it is expedient that those arrangements should Arrangement between the Government of Nigeria and the Government of Sierra Leone for the avoidance of double taxation and the prevention of :fiscal evasion with respect to taxes on income. 1. (1) The taxes which are the subject of this Arrangement are- (a) In Nigeria: The Income Tax (hereinafter referred to as " Nigerian tax "). The Income Tax (hereinafter referred to as" Sierra Leone tax"). tantially similar character imposed in Nigeria or Sierra Leone after this arrangement has come into force. 2. (1) In this Arrangement, unless the context otherwise requires- (a) The term "Nigeria" means the Colony and Protectorate of Nigeria, including the Cameroons under United Kingdom Trusteeship. (b) The term " Sierra Leone " means the Colony and Protectorate of (c) The terms " one of the territories" and " the other territory" mean Nigeria or Sierra Leone, as the context requires. (d) The term" tax" means Nigerian tax or Sierra Leone tax, as the context requires. (/) The term " company " includes any body corporate. 26 ofl950. 2152 Cap. 273] Income Tax (g) The terms" resident of Nigeria " and" resident of Sierra Leone " mean respectively any person who is resident in Nigeria for the purposes of Nigerian tax and not resident in Sierra Leone for the purposes of Sierra Leone tax and any person who is resident in Sierra Leone for the purposes of Sierra Leone tax and not resident in Nigeria for the purposes of Nigerian tax; and a company shall be regarded as resident in Nigeria if its business is managed and controlled in Nigeria and as resident in Sierra Leone if its business is managed and controlled in Sierra Leone. (h) The terms " resident of one of the territories " and "resident of the other territory " mean a person who is a resident of Nigeria or a person who is a resident of Sierra Leone as the context requires. (i) The terms "Nigeria enterprise " and " Sierra Leone enterprise " mean respectively an industrial or commercial enterprise or undertaking carried on by a resident of Nigeria and an industrial or commercial enterprise or undertaking carried on by a resident of Sierra Leone; and the terms " enterprise of one of the territories " and " enterprise of the other territory " mean a Nigerian enterprise or a Sierra Leone enterprise, as the context requires. (j) The term " industrial or commercial profits " includes rentals in respect of cinematogTaph films. (k) The term" permanent establishment," when used with respect to an enterprise of one of the territories, means a branch, management or other fixed place of business, but does not include an agency unless the agent has, and habitually exercises, a general authority to negotiate and conclude contracts on behalf of such enterprise or has a stock of merchandise from which he regularly fills orders on its behalf. An enterprise of one of the territories shall not be deemed to have a permanent establishment in the other territory merely because it carries on business dealings in that other territory through a bona fide broker or general commission agent acting in the ordinary course of his business as such. The fact that an enterprise of one of the territories maintains in the other territory a fixed place of business exclusively for the purchase of goods or merchandise shall not of itself constitute that fixed place of business a permanent extablishment of the enterprise. The fact that a company which is a resident of one of the territories has a subsidiary company which is a resident of the other territory or which is engaged in trade or business in that other territory (whether through a permanent establishment or otherwise) shall not of itself constitute that subsidiary company a permanent establishment of its parent company. (2) Where under this Arrangement any income is exempt from tax in one of the territories if (with or without other conditions) it is subject to tax in the other territory, and that income is subject to tax in that other in that other territory, the exemption to be allowed under this Arrangement in the first-mentioned territory shall apply only to the amount so remitted or received. (3) In the application of the provisions of this Arrangement by Nigeria or Sierra Leone, any term not otherwise defined shall, unless the context otherwise requires, have the meaning which it has under the laws of Nigeria or, as the case may be, Sierra Leone, relating to the taxes which are the subject of this Arrangement . Double Taxation Relief (Federation of Nigeria) [Cap. 273 3. (1) The industrial or commercial profits of a Nigerian enterprise trade or business in Sierra Leone through a permanent establishment situated Leone but only on so much of them as is attributable to that permanent (2) The industrial or commercial profits of a Sierra Leone enterprise shall not be subject to Nigerian tax unless the enterprise is engaged in trade or business in Nigeria through a permanent establishment situated therein. If it is so engaged, tax may be imposed on those profits by Nigeria but only on so much of them as is attributable to that permanent establishment. (3) Where an enterprise of one of the Territories is engaged in trade or business in the other territory through a permanent establishment situated industrial or commercial profits which it might be expected to derive from its activities in that other territory if it were an independent enterprise engaged dealing at arm's length with the enterprise of which it is a permanent (4) No portion of any profits arising from the sale of goods or merchandise by an enterprise of one of the territories shall be attributed to a perma,nent establishment situated in the other territory by reason of the mere purchase and transportation of the goods or merchandise within that other territory, and the mere purchase and transportation of goods or merchandise outside that other territory shall not prevent the attribution to the permanent establishment of the whole profit arising from the sale of the goods or merchandise through the permanent establishment. 4. Whereindirectly in the, management, control or capital of an enterprise of the enterprise of the other territory, and (c) in either case conditions are made or. imposed between the two enterprisesJ in their commereial 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 5. Notwithstanding the provisions of paragraphs 3 and 4, profits which a resident of one of the territories derives from operating ships, aircraft or road transport vehicles shall be exempt from tax in the other territory. 6. (1) Dividends paid by a company resident in one of the territories to 2154 Cap. 273] Income Tax that other territory shall not impose any form of taxation on dividends paid by the company to persons not resident in that other territory, or any tax in the nature of an undistributed profits tax on undistributed profits of the 7. (1) Any royalty derived from sources within one of the territories by respect thereof and is not engaged in trade or business in the first-mentioned from tax in that first-mentioned territory but no exemption shall be allowed under this paragraph in respect of so much of any royalty as exceeds an amount which represents a fair and responsible consideration for the rights for which the royalty is paid. (2) In this paragraph the term " royalty " means any royalty or other property, but does not include a royalty or other amount paid in respect of the operation of a mine or quarry or of other extraction or natural resources. 8. (1) Remuneration, excluding pensions, paid by the Government of one of the territories or by an employer who is a resident of one of the territories and who has no permanent establishment in the other territory to any individual for services rendered to that Government or that employer in the discharge of functions of the Government or of the employer, shall be exempt . from tax in the other territory if the individual is not resident in that other territory or is resident in that other territory solely for the purpose of rendering those services. (2) In determining, for any period subsequent to the end of a period during which the individual was present in the other territory solely for the purpose of rendering governmental services, whether he is liable to tax in that other territory, the periods spent in that other territory solely for the purpose of rendering governmental services shall not be taken into consideration. 9. (1) An individual who is a resident of Nigeria shall be exempt from Sierra Leone tax on profits or remuneration in respect of personal (including professional) services performed within Sierra Leone in any year of assessment Nigeria, and ,., (c) the profits or remuneration are subject to Nigerian tax. (2) An individual who is a resident of Sierra Leone shall be exempt from Nigerian tax on profits or remuneration in respect of personal (including professional) services performed within Nigeria in any year of assessment if- (a) he is present within Nigeria for a period or periods not exceeding Sierra Leone, and Double Taxation Relief (Federation of Nigeria) [Cap. 273 10. (1) Any pension and any annuity, derived from sources within Sierra. Leone by an individual who is a resident of Nigeria and subject to Sierra Leone tax in respect thereof, shall be exempt from Nigerian tax. (2) Any pension and any annuity, derived from sources within Nigeria by an individual who is a resident of Sierra Leone and subject to Nigerian tax in respect thereof, shall be exempt from Sierra Leone tax. (3) The term "annuity" means a stated sum payable periodically at stated times, during life or during a specified or ascertainable period of time, 11. The remuneration derived by a professor or teacher who is ordinarily 12. A student or business apprentice from one of the territories who is receiving full time education or training in the other territory shall be exempt training and, in determining, for any period subsequent to the completion of such education or training, whether the individual is liable to tax in the other territory, any periods spent in the other territory for the purposes of education or training shall not be taken into consideration. 13. (1) Subject to the provisions of the law of Nigeria regarding the allowance as a credit against Nigerian tax of tax payable in a territory outside Nigeria, Sierra Leone tax payable, whether directly or by deduction, in respect of income from sources within Sierra Leone shall be allowed as a credit against any Nigerian tax payable in respect of that income. (2) Subject to the provisions of the law of Sierra Leone regarding the allowance as a credit against Sierra Leone tax of tax payable in a territory outside Sierra Leone, Nigerian tax payable, whether directly or by deduction, in respect of income from sources within Nigeria shall be allowed as a credit against any Sierra Leone tax payable in respect of that income. (3) For the purposes of this paragraph profits or remuneration for personal deemed to be income from sources within that territory and the services of an individual whose services are wholly or mainly performed in ships, aircraft or road transport vehicles operated by a resident of one of the territories shall be deemed to be performed in that territory. 14. (1) The taxation authorities of Nigeria and Sierra Leone shall exchange such information (being information available under their respective taxation laws) as is necessary for carrying out the provisions of this Arrangement or for the prevention of fraud or the administration of statutory provisions against legal avoidance in relation to the taxes which are the subject of this arrangement. Any information so exchanged shall be treated as secret and shall not be disclosed to any persons other than those concerned with the assessment and collection of the taxes which are the subject of this Arrangement. No information shall be exchanged which would disclose any trade secret or trade process. (2) As used in this paragraph, the term " taxation authorities " means the Commissioner of Income Tax as defined in section 2 of the Income Tax Ordinance, 1943. Sierra Leone No. I of 1943 Nigeria No. 29 of 1943. Cap::. ::;, An~mcnt 'hal~::::oo on the da~ on which the m,t , of all such things shall have been done in Nigeria and Sierra Leone as are • necessary to give the Arrangement the force of law in Nigeria and Sierra Leone respectively, and shall thereupon have effect for the year of assessment beginning on the first day of April, 1949 and subsequent years. 16. This Arrangement shall continue in effect indefinitely but either of the i !): •. Governments may, on or before the thirtieth day of September in any calendar !! ( year after the year 1950, give notice of termination to the other Government : ~-··;_.• and in such event, this arrangement shall cease to be effective for any year of . assessment beginning on or after the first day of April in the calendar year next following that in which such notice is given. GHANA. The Order which follows was made when Ghana was the Gold Coast. ~~r 1950_ DOUBLE TAXATION RELIEF (GOLD COAST) ORDER. 1. This Order may be cited as the Double Taxation Relief ·(Gold Coast) Order in Council, 1950. 2. It is hereby declaredset out in the Schedule to this Order have been made with the Government of the Gold Coast with a view to affording relief from double taxation in relation to tax and any tax of a similar character imposed by the laws of the Gold Coast; and (b) That it IS expedient that those arrangements should Arrangement between the Government of the Gold Coast and the Government of Sierra Leone for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income. 1. (1) The taxes which are the subject of this Arrangement are- (a) In the Gold Coast: The Income Tax (hereinafter referred to as " Gold Coast tax "). The Income Tax (hereinafter referred to as "Sierra Leone tax"). stantially similar character imposed in the Gold Coast or Sierra Leone after this arrangement has come into force. Double Taxation Relief (Ghana) [Cap. 273 2. (1) In this Arrangement, unless the context otherwise requires- (a) The term "the Gold Coast" means the Gold Coast inc~uding Togoland under United Kingdom Trusteeship. (b) The term" Sierra Leone" means the Colony and Protectorate of (c) The terms " one of the territories" and "the other territory" mean the Gold Coast or Sierra. Leone, as the context requires. (d) The term "tax" means Gold Coast tax or Sierra Leone tax, as the context requires. (j) The term " company " includes any body corporate. (g) The terms " resident of the Gold Coast " and " resident of Sierra Leone " mean respectively any person who is resident in the Gold Coast for the purposes of Gold Coast tax and not resident in Sierra Leone for the purposes of Sierra Leone tax and any person who is resident in Sierra Leone for the purposes of Sierra Leone tax and not resident in the Gold Coast for the purposes of Gold Coast tax; and a company shall be regarded as resident in the Gold Coast if its ·business is managed and controlled in Gold Coast and as resident in Sierra Leone if its business is • managed and controlled in Sierra Leone. (h) The terms "resident Qf one of the territories" and "resident of the other territory " mean a person who is a resident of the Gold Coast or a person who is a resident of Sierra Leone as the context requires. (i) The terms " Gold Coast enterprise" and " Sierra Leone enterprise " mean respectively an industrial or commercial enterprise or undertaking carried on by a resident of the Gold Coast and an industrial or commercial enterprise or undertaking carried on by a resident of Sierra Leone; and the terms " enterprise of one of the territories " and " enterprise of: the other territory " mean a Gold Coast enterprise or a Sierra Leone enterprise, as the context requires. (j) The term " industrial or commercial profits " includes rentals in respect of cinematograph films. to an enterprise of one of the territories, means a branch, management or other fixed place of business, but does not include an agency unless the agent has, and habitually exercises, a general authority to negotiate and conclude contracts on behalf of such enterprise or has a stock of merchandise from which he regularly fills orders on its behalf. An enterprise of one of the territories shall not be deemed to have a permanent establishment in the other territory merely because it carries on business dealings in that other territory through a bona fide broker or general commission agent acting in the ordinary course of his business as such. The fact that an enterprise of one of the territories maintains in the other territory a fixed plape of business exclusively for the purchase of goods or merchandise shall not of itself constitute that fixed place of business a permanent establishment of the enterprise. The fact that a company which is a resident of one of the territories has a subsidiary company which is a resident of the other territory or which is engaged in trade or business in that other territory (whether through a permanent establishment or otherwise) shall not of itself constitute that subsidiary company a permanent establishment of its parent company. S.L.-VoL. VIII-31 2158 Cap. 273] Income Tax (2) Where under this Arrangement any income is exempt from tax in one of the territories if (with or without other conditions) it is "Subject to tax in the other territory, and that income is subject to tax in that other in that other territory, the exemption to be allowed under this Arrangement in the :first-mentioned territory shall apply only to the amount so remitted or received. (3) In the application of thB provisions of this Arrangement by the Gold Coast or Sierra Leone, any term not otherwise defined shall, unless the context otherwise requires, have the :q:teaning which it has under the laws of the Gold Coast or, as the case may be, Sierra Leone, relating to the taxes which are the subject of this Arrangement. 3. (1) The industrial or commercial profits of a Gold Coast enterprise trade or business in Sierra Leone through a permanent establishment situated Leone but only on so much of them as is attributable to that permanent (2) The industrial or commercial profits of a Sierra Leone enterprise shall not be subject to Gold Coast tax unless the enterprise is engaged in trade or business in the Gold Coast through a permanent establishment situated therein. If it is so engaged, tax may be imposed on those profits by the Gold Coast, but only on so much of them as is attributable to that permanent (3) Where an enterprise of one of the territories is engaged in trade or business in the other territory through a permanent establishment situated industrial or commercial profits which it might be expected to derive from its activities in that other territory if it were an independent enterprise engaged dealing at arm's length with the enterprise of which it is a permanent ( 4) No portion of any profits ansmg from the sale of goods or merchandise by an enterprise of one of the territories shall be attributed to a permanent establishment situated in the other territory by reason of the mere purchase and transportation of the goods or merchandise within that other territory, and the mere purchase and transportation of goods or merchandise outside that other territory shall not prevent the attribution to the permanent establishment of the whole profit arising from the sale of the goods or merchandise through the permanent establishment. 4. Wherement, control or capital of an enterprise of one of the territories and an enterprise of the other territory, and enterprises, in their commercial or financial relations, which differ from those which would be made between independent enterprises Double Taxation Relief (Ghana) [Cap. 273 then any profits which would but for these conditions have accrued, to one of 5. Notwithstanding the provisions of paragraphs 3 and 4, profits which a resident of one of the territories derives from operating ships, aircraft or road transport vehicles shall be exempt from tax in the other territory. 6. (1) Dividends paid by a company resident in one of the territories to (2) Where a company which is a resident of one of the territories derives profits or income from sources within the other territory, the Government of that other territory shall not impose any form of taxation, on dividends paid by the company to persons not resident in that other territory, or any tax in the nature of an undistributed profits tax on undistributed profits of the • 7. (1) Any royalty derived from sources within one of the territories by a resident of the other territory, who is subject to tax. in that other territory in respect thereof and is not engaged in trade or business in the first-mentioned from tax in that first-mentioned territory but no exemption shall be allowed under this paragraph in respect of so much of any royalty as exceeds an amount which represents a fair and reasonable consideration for the rights for which the royalty is paid. (2) In this paragraph the term "royalty" means any royalty or other property, but does not include a royalty or other amount paid in respect of the operation of a mine or quarry or of other extraction or natural resources. 8. (1) Remuneration, excluding pensions, paid by the Government of one of the territories or by an employer who is a resident of one of the territories and who has no permanent establishment in the other territory to any individual for services rendered to that Government or that employer in the discharge of functions of the Government or of the employer, shall be exempt from tax in the other territory if the individual is not resident in that territory or is resident in other territory solely for the purpose of rendering those Services. (2) In determining, for any persiod subsequent to the end of a period during which the individual was present in the other territory solely for the purpose of rendering governmental services, whether he is liable to tax in that other territory, the periods spent in that other territory solely for the purpose of rendering governmental services shall not be taken into consideration. 9. (1) An individual who is a resident of the Gold Coast shall be exempt from Sierra Leone tax on profits or remuneration in respect of personal (including professional) services performed within Sierra Leone in any year of assessment if- S.,L.-VoL. VIII-31* 2160 Cap. 273] Income Tax the Gold Coast, and (c) the profits or remuneration are subject to Goid Coast tax. (2) An individual who is a resident of Sierra Leone shall be exempt from Gold Coast tax on profits or remuneration in respect of personal (including professional) services performed within the Gold Coast in any year of assessment if- (a) he is present within the Gold Coast for a period or periods not exceeding in the aggregate 183 days during that year and 10. (1) Any pension and any annuity, derived from so~ces within Sierra Leone by an individual who is a resident of the Gold Coast and subject to Sierra Leone tax in respect thereof, shall be exempt from Gold Coast tax. (2) Any pension and any annuity, derived from sources within the Gold Coast by an individual who is a resident of Sierra Leone and subject to Gold Coast tax in respect thereof, shall be exempt from Sierra Leone tax. (3) The term " annuity " means a stated sum payable periodically at 11. The remuneration derived by a professor or teacher who is ordinarily 12. A student or business apprentice from one of the territories who is receiving full time education or training in the other territory shall be exempt first-mentioned territory for the purposes of his maintenance, education or training and, in determining, for any period subsequent to the completion of such education or training, whether the individual is liable to tax in the other territory, any periods spent in the other territory for the purposes of education or training shall not be taken into consideration. 13. (1) Subject to the provisions of the law of the Gold Coast regarding the allowance as a credit against Gold Coast tax or tax payable in a territory outside the Gold Coast, Sierra Leone tax payable, whether directly or by deduction, in respect of income from sources within Sierra Leone shall be allowed as a credit against any Gold Coast tax payable in respect of that . income. (2) Subject to the provisions of the law of Sierra Leone regarding the allowance as a credit against Sierra Leone tax of tax payable in a territory outside Sierra Leone, Gold Coast tax payable, whether directly or by deduction, in respect of income from sources within the Gold Coast shall be allowed as a credit against any Sierra Leone tax payable in respect of that income. Double Taxation Relief (The Gambia) [Cap. 273 (3) For the purposes of this paragraph profits or remuneration for personal (including professional) services performed in one of the territories shall be deemed to be income from sources within that territory, and the services of an individual whose services are wholly or mainly performed in ships, aircraft or road transport vehicles operated by a resident of one of the territories shall be deemed to be performed in that territory. 14. (1) The taxation authorities of the Gold Coast and Sierra Leone shall exchange such information (being information available under their respective taxation laws) as is necessary for carrying out the provisions of this Arrangement or for the prevention of fraud or the administration of statutory provisions against legal avoidance in relation to the taxes which are the subject of this Arrangement. Any information so exchanged shall be treated as secret and shall not be disclosed to any persons other than those concerned with the assessment and collection of the taxes which are the subject of this Arrangement. No information shall be exchanged which would disclose any trade secret or trade process. (2) As used in this paragraph, the term "taxation authorities" means the Commissioner of Income Tax as defined in section 2 of the Income Tax Ordinance, 1943. 15. This Arrangement shall come into force on the date on which the l!tst of all such things shall have been done in the Gold Coast and Sierra Leone as are necessary to give the Arrangement the force of law in the Gold Coast and Sierra Leone respectively, and shall thereupon have effect for the year of assessment beginning on the first day of April, 1949 and subsequent years. 16. This Arrangement shall continue in effect indefinitely but either of the Governments may, on or before the thirtieth day of September in any calendar year after the year 1950, give notice of termination to the other Government and, in such event, this arrangement shall cease to be effective for any year of assessment beginning on or after the :first day of April in the calendar year next following that in which such notice is given. THE COLONY AND PROTECTORATE OF THE GAMBIA. THE DOUBLE TAXATION RELIEF (GAMBIA) ORDER. 1. This Order may be cited as the Double Taxation Relief (Gambia) Order in Council, 1950. 2. It is hereby declaredset out in the Schedule to this Order have been made with the Government of the Gambia with a view to affording relief from double taxation in relation to tax and any tax of a similar character imposed by the laws of the Gambia; and (b) That it is expedient that those arrangements should Sierra Leone No.1 ofl943 Gold Coast No. 27 of 1943. 28 of 1950. 2162 Cap. 273] Income Tax Arrangement between the Government of the Gambia and the Government of Sierra Leone for the avoidance of double taxation and the prevention of :fiscal evasion with respect to taxes on income. 1. (1) The taxes which are the subject of this Arrangement are- (a) In the Gambia: The Income Tax (hereinafter referred to as "Gambian tax"). The Income Tax (hereinafter referred to as " Sierra Leone tax"). stantially similar character imposed in the Gambia or Sierra Leone after this arrangement has come into force. 2. (1) In this Arrangement, unless the context otherwise requires- (a) The term" The Gambia" means the Colony and Protectorate of the Gambia. (b) The terms" Sierra Leone" means the Colony and Protectorate of (c) The terms " one of the territories" and "the other territory " mean the Gambia or Sierra Leone, as the context requires. (d) the term" tax" means Gambian tax or Sierra Leone tax, as the context requires. (e) the term "person" includes any body of persons, corporate or not coq~orate. (j) The term " company " includes any body corporate. (g) The terms " resident of the Gambia " and " resident of Sierra Leone " mean respectively any person who is resident in the Gambia for the purposes of Gambian tax and not resident in Sierra Leone for the purposes of Sierra Leone tax and any person who is resident in Sierra Leone for the purposes of Sierra Leone tax and not resident in the Gambia for the purposes of Gambian tax; and a company shall be regarded as resident in the Gambia if its business is managed and controlled in the Gambia and as resident in Sierra Leone if its business is managed and controlled in Sierra Leone. (h) The terms "resident of one of the territories" and "resident of the other territory " mean a person who is a resident of the Gambia or a person who is a resident of Sierra Leone as the context requires. (i) The terms" Gambian enterprise" and" Sierra Leone enterprise" mean respectively an industrial or commercial enterprise or undertaking carried on by a resident of the Gambia and an industrial or commercial enterprise or undertakrng carried on by a resident of Sierra Leone; and the terms " enterprise of one of the territories " and " enterprise of th!l other territory " mean a Gambian enterprise or a Sierra Leone enterprise, as the context requires. , (j) The term " industrial or commercial profits " includes rentals in respect of cinematograph :films. (k) The terms "permanent establishment," when used with respect to an enterprise of one of the territories, means a branch, management or other :fixed place of business, but does not include an agency unless Double Taxation Relief (The Gambia) [Cap~ 273 the agent has, and habitually exercises, a general authority to negotiate and conclude contracts on behalf of such enterprise or has a stock of merchandise from which he regularly fills orders on its behalf. An enterprise of one of the territories shall not be deemed to have a permanent establishment in the other territory merely because it carries on business dealings in that other territory through a bona fide broker or general commission agent acting in the ordinary course of his business as such. ·· The fact that an enterprise of one of the territories maintains in the other territory ·a fixed place of business exclusively for the purchase of goods or merchandise shall not of itself constitute that fixed place of business a permanent establishment of the enterprise. The fact that a company which is a resident of one of the territories has a subsidiary company which is a resident of the other territory or which is engaged in trade or business in that other territory (whether through a permanent establishment or otherwise) shall not of itself constitute that subsidiary company a permanent establishmen~ of its parent company. (2) Where under this Arrangement any income is exempt from tax in one of the territories if (with or without other conditions) it is subject to tax in the other territory, and that income is subject to tax in that other t~ritory by reference to the amount thereof which is remitted to or received in that other territory, the exemption to be allowed under this Arrangement in the first-mentioned territory shall apply only to the amount so remitted or (3) In the application of the provisions of this Arrangement by the Gambia or Sierra Leone, any terms not otherwise defined shall, unless the context otherwise requires, have the meaning which it has under the laws of the Gambia or, as the case may be, Sierra Leone, relating to the taxes which are the subject of this Arrangement. 3. (1) The industrial or commercial profits of a Gambian enterprise trade or business in Sierra Leone through a permanent establishment situated Leone but only on so much of them as is attributable to that permanent (2) The industrial or commercial profits of a Sierra Leone enterprise shall not be subject to Gambian tax unless the enterprise is engaged in trade or business in the Gambia through a permanent establishment situated therein. If it is so engaged, tax may be imposed on those profits by the Gambia but only on so much of them as is attributable to that permanent (3) Where an enterprise of one of the territories is engaged in trade or business in the other territory through a permanent establishment situated therein, there shall be attributed to that permanent establishment the industrial or commercial profits which it might be expected to derive from its activities in that other territory if it were an independent enterprise engaged in the same or similar activities under. the same or similar conditions and dealing at arm's length with the enterprise of which it is a permanent (4) No portion of any profits arising from the sale of goods or merchandise by an enterprise of one of the territories shall be attributed to a permanent establishment situated in the other territory by reason of the mere 2164 Cap. 273] Income Tax. purchase and transportation of the goods or merchandise within that other territory, and the mere purchase and transportation of goods or merchandise outside that other territory shall not prevent the attribution to the permanent establishment of the whole profit arising from the sale of the goods or merchandise through the permanent establishment. 4. Wherement, control or capital of an enterprise of one of the territories and an enterprise of the other territory, and 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 5. Notwithstanding the provisions of paragraphs 3 and 4, profits which a resident of one of the territories derives from operating ships, aircraft or road transport vehicles shall be exempt from tax in the other territory. 6. (l) Dividends paid by a company resident in one of the territories to (2) \Vhere a company which is a resident of one of the territories derives that other territory shall not impose any form of taxation on dividends paid by the company to persons not resident in that other territory, or any tax in the nature of an undistributed profits tax on undistributed profits of the represent in whole or in part, profits or income so derived. 7. (1) Any royalty derived from sources within one of the territories by respect thereof and is not engaged in trade or business in the first-mentioned from tax in that first-mentioned territory but no exemption shall be allowed under this paragraph in respect of so much of any royalty as exceeds an amount whi:ch represents a fair and reasonable consideration for the rights for which the royalty is paid. (2) In this paragraph the term " royalty " means any royalty or other property, but does not include a royalty or other amount paid in respect of the operation of a mine or quarry or of other extraction of natural resources. Double Taxation Relief (The Gambia) [Cap. 273 8. (1) Remuneration, excluding pensions, paid by the Government of ore of the territories or by an employer who is a resident of one of the territories and who has no permanent establishment in the other territory to any individual for services rendered to that Government or that employer in the discharge of functions of the Government or of the employer, shall be exempt from tax in the other territory if the individual is not resident in that other territory or is resident in that other territory solely for the purpose of rendering those services. (2) In determining, for any period subsequent to the end of a period during which the individual was present in the other territory solely for the purpose of rendering governmental services, whether he is liable to tax in that other territory, the periods spent in that other territory solely for the purpose of rendering governmental services shall not be taken into consideration. 9. (1) An individual who is a resident of the Gambia shall be exempt from Sierra Leone tax on profits or remuneration in respect of personal (including professional) services performed·within Sierra Leone in any year of • the Gambia, and (c) the profits or remuneration are subject to Gambian tax. (2) An individual who is a resident of Sierra Leone shall be exempt from Gambian tax on profits or femuneration in respect of personal (including professional) services performed within the Gambia in any year of assessment (a) he is present within the Gambia for a period or periods not 10. (1) Any pension and any annuity, derived from sources within Sierra Leone by an individual who is a resident of the Gambia and subject to Sierra Leone tax in respect thereof, shall be exempt from Gambian tax. (2) Any pension and any annuity, derived from sources within the Gambia by an individual who is a resident of Sierra Leone and subject to Gambian tax in respect thereof, shall be exempt from Sierra Leone tax. (3) The term " annuity " means a stated sum payable periodically at 11. The remuneration derived by a professor or teacher who is ordinarily 12. A student or business apprentice from one of the territories who is receiving full-time education or training in the other territory shall be exempt 2166 Cap. 273] Income Tax training and, in determining, for any period subsequent to the completion of such education or training, whether the individual is liable to tax in the other territory, any periods spent in the other territory for the purposes of education or training shall not be taken into consideration. 13. (l) Subject to the provisions of the law of the Gambia regarding the allowance as a credit against Gambian tax of tax payable in a territory outside the Gambia, Sierra Leone tax payable, whether directly or by deduction, in respect of income from sources within Sierra Leone shall be allowed as a credit against any Gambian tax payable in respect of that income. (2) Subject to the provisions of the law of Sierra Leone regarding the allowance as a credit against Sierra Leone tax or tax payable in a territory outside Sierra Leone, Gambian tax payable, whether directly or by deduction in respect of income from sources within the Gambia shall be allowed as a credit against any Sierra Leone tax payable in respect of that income. (3) For the purposes of this paragraph profits or remuneration for personal (including professional) services performed in one of the territories shall be deemed to be income from sources within that territory, and the services of an individual whose services are wholly or mainly performed in ships, aircraft or road transport vehicles operated by a resident of one of the territories shall be deemed to be performed in that territory. 14. (1) The taxation authorities of the Gambia and Sierra IJeone shall exchange such information (being information available under their respective taxation laws) as is necessary for carrying out the provisions of this arrangement or for the prevention of fraud or the administration of statutory provisions against legal avoidance in relation to the taxes which are the subject of this Arrangement. Any information so exchanged shall be treated as secret and shall not be disclosed to any persons other than those concerned with the assessment and collection of the taxes which are the subject of this Arrangement. No information shall be exchanged which would disclose any trade secret or trade process. (2) As used in this paragraph, the term "taxation authorities" means the Commissioner of Income Tax as defined in section 2 of the Gambian Income Tax Ordinance, No. 26 of 1948, and in section 2 of the Sierra Leone Income Tax Ordinance, No. 1 of 1943. 15. This Arrangement shall come into force on the date on which the last of all such things shall have been done in the Gambia and Sierra Leone as are necessary to give the Arrangement the force of law in the Gambia and Sierra Leone respectively, and shall thereupon have effect-- (a) in the Gambia for the year of assessment beginning on the first day of January, 1949, and subsequent years; (b) in Sierra Leone for the year of assessment beginning on the first day of April, 1949, and subsequent years. 16. This Arrangem~nt shall continue in effect indefinitely but either of the Governments may, on or before the thirtieth day of September in any calendar year after the year 1950, give notice of termination to the other Government and, in such event, this arrangement shall cease to be effective- (a) in the Gambia for any year of assessment beginning on or after the first day of January in the calendar year next following that in which such notice is given; Double Taxation Relief (Canada) [Cap._273 (b) in Sierra Leone for any year of assessment beginning on or after the fi.rst day of April in the calendar year next following that in which such notice is given. THE DOMINION OF CANADA. (CANADA) ORDER. 1. This Order may be cited as the Income Tax (Double Taxation Relief) (Canada) Order in Council, 1953. 2. It is hereby declared- (a) that the arrangements specified in the arrangement set out in the Schedule to this Order have been made with the Government of Canada with a view to affording relief from double taxation in relation to income tax, and taxes of a si:r,nilar character imposed by the laws of Canada; and ARRANGEMENT BETWEEN THE GOVERNMENT OF SIERRA LEONE AND THE GOVERNMENT OF CANADA FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EvASION WITH RESPECT TO TAXES ON INCOME. 1. (1) The taxes which are the subject of this arrangement are- (a) In Canada: The income taxes, including surtaxes, and excess profits tax imposed by Canada (hereinafter referred to as "Canadian tax"). The income tax (hereinafter referred to as" Sierra Leone tax"). (2) This arrangement shall also apply to any other taxes of a substantially similar character imposed in Canada or Sierra Leone after this arrangement has come into force. 2. (1) In this Arrangement, unless the context otherwise requires- (a) The term "Sierra Leone" means the Colony and Protectorate of Sierra Leone. (b) The term" Canada" means the Dominion of Canada. (c) The terms " one of the territories" and " the other territory" mean Sierra Leone or Canada, as the context requires. (d) The term "tax" means Sierra Leone tax or Canadian tax, as the context requires. 14 of 1953. 2168 Cap. 273] Income Tax · not corporate. · (/) The term " company " includes any body corporate. (g) The terms " resident of Sierra Leone " and" resident of Canada " mean respectively any person who is resident in Sierra Leone for the purposes of Sierra Leone tax and not resident in Canada for the purposes of Canadian tax and any person who is resident in Canada for the purposes of Canadian tax and not resident in Sierra Leone for the purposes of Sierra Leone tax; and a company shall be regarded as resident in Sierra Leone if its business is managed and controlled in Sierra Leone and as resident in Canada if its business is managed and controlled in Canada. (h) The terms "resident of one of the territories " and "resident of the other territory " mean a person who is a resident of Sierra Leone or a person who is a resident of Canada, as the context requires. (i) The terms" Sierra Leone enterprise" and" Canadian enterprise" mean respectively an industrial or commercial enterprise or undertaking carried on by a resident of Canada; and the terms " enterprise of one of the territories " and " enterprise of the other territory " mean a Sierra Leone enterprise or a Canadian enterprise, as the context requires. (j) The term "permanent establishment", when used with respect to an enterprise of one of the territories, means a branch or other fixed place of business, but does not include an agency unless the agent has, and habitually exercises, a general authority to negotiate and conclude contracts on behalf of such enterprise or has a stock of merchandise from which he regularly fills orders on its behalf. An enterprise of one of the territories shall not be deemed to have a permanent establishment in the other territory merely because it carries on business dealings in that other territory through a boria fide broker or general commission agent acting in the ordinary course of his business as such. The fact that an enterprise of one of the territories maintains in the other territory a fixed place of business exclusively for the purchase of goods or merchandise shall not of itself constitute that fixed place of business a permanent establishment of the enterprise. The fact that a company which is a resident of one of the territories has a subsidiary company which is a resident of the other territory or which is engaged in trade or business in that other territory (whether constitute that subsidiary company a permanent establishment of its parent company. (2) The term" industrial or commercial profits ", as used in this Arrangement, does not include income in the form of dividends, interest, rents or royalties, management charges, or remuneration for labour or personal services. (3) In the application of the provisions of this Arrangement by Canada or Sierra Leone any term not otherwise defined shall, unless the context otherwise requires, have the meaning which it has under the law of Canada or Sierra Leone relating to the taxes which are the subject of this Arrangement. 3. (1) The industri~l or commercial profits of a Sierra Leone enterprise shall not be subject to Canadian tax unless the enterprise is engaged in trade Double Taxation Relief (Canada) [Cap. 273 or business in Canada through a permanent ~establisl?ment situated therein. If it is so engaged, tax may be imposed on those profits by Canada, but only on so much of them as is attributable to that permanent establishment. (2) The industrial or commercial profits of a Canadian enterprise shall not be subject to Sierra Leone tax unless the enterprise is engaged in trade or business in Sierra Leone through a permanent establishment situated Leone, but only on so much of. them as is attributable to that permanent (3) Where an enterprise of one of the territories is engaged in trade or therein, there shall be attributed to 'such permanent establishment the industrial or commercial profits which it might be expected to derive if it were an independent enterprise engaged in the same or similar activities under the same or similar conditions and dealing at arm's length with the enterprise of which it is a permanent establishment. (4) No portion of any profits arising from the sale of goods or merchandise by an enterprise of one of the territories shall be deemed to arise in the other territory by reason of the mere purchase of the goods or merchandise within (5) Where a company which is a resident of one of the territories derives . profits or income from sources within the other territory, the Government of that other territory shall not impose any form of taxation on dividends paid by the company to persons not resident in that other territory, or any tax in the nature of an undistributed profits tax on undistributed profits of the 4. Whereenterprise of the other territory, and 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 5. Notwithstanding the provisions of paragraphs 3 and 4, profits which 6. (1) The rate of Canadian tax on income (other than earned income) derived from sources within Canada by a resident of Sierra Leone, who is subject to Sierra Leone tax in respect thereof and not engaged in trade or business in Canada through a permanent establishment situated therein, shall not exceed 15 per cent. (2) Notwithstanding the provisions of the foregoing paragraph, dividends paid to a company which is a resident of Sierra Leone by a Canadian company, 2170 Cap. 273] Income Tax all of whose shares (less directors' qualifying shares) which have under all circumst~nces full voting rights are beneficially owned by the former company, shall be exempt from Canadian tax: Provided that exemption shall not be allowed if ordinarily more than one-quarter of the gross income of the Canadian company is derived from interest and dividends other than interest and dividends from any whollyowned subsidiary company. (3) Income (other than earned income) derived from sources within Sierra Leone by an individual who is a resident of Canada, subject to Canadian tax in respect of the income, and not engaged in trade or business in Sierra Leone through a permanent establishment situated therein, shall be exempt from Sierra Leone tax. · 7. Copyright royalties and other like payments made in respect of the production or reproduction of any literary, dramatic, musical or artistic work (but not including rents or royalties in respect of motion picture films) and derived from sources within one of the territories by a resident of the other territory, who is liable to tax in that other territory in respect thereof and not engaged in trade or business in the first-mentioned territory through a 8. (1) Remuneration (other than pensions) paid by the Government of one of the territories to any individual for services rendered to that Government in the discharge of governmental functions shall be exempt from tax in the territory of the other Government if the individual is not ordinarily resident in that territory or is ordinarily resident in that territory solely for the purpose of rendering those services. (2) Any pension paid by the Government of one of the territories to any individual for services rendered to that Government in the discharge of governmental functions shall be exempt from tax in the territory of the other Government, if immediately prior to the cessation of those services the remuneration therefor was exempt from tax in that territory, whether under sub-paragraph (1) of this paragraph or otherwise, or would have been exempt under that sub-paragraph if this Arrangement had been in force at the time when the remuneration was paid. (3) The provisions of this paragraph shall not apply to payments in respect of services rendered in connection with any trade or business carried on by either of the Governments for purposes of profit. 9. (1) An individual who is a resident of Sierra Leone shall be exempt from Canadian tax on profits or remuneration in respect of personal (including professional) services performed within Canada in any taxation year if- (a) he is present within Canada for a period or periods not exceeding (2) An individual who is a resident of Canada shall be exempt from Sierra Leone tax on profits or remuneration in respect of personal (including professional) services performed within Sierra Leone in any year of assessment Double Taxation Relief (Canada) [Cap. 273 in Canada, and (c) the profits or remuneration are subject to Canadian tax. 10. (1) Any pension (other than a pension paid by the Government of Canada for services rendered to it in the discharge of governmental functions) and any annuity, derived from sources within Canada by an individual who is a resident of Sierra Leone and subject to Sierra Leone tax in respect thereof, shall be exempt from Canadian tax. (2) Any pension (other than a pension paid by the Government of Sierra Leone for services rendered to it in the discharge of governmental functions) and any annuity, derived from sources within Sierra Leone by an individual who is a resident of Canada and subject to Canadian tax in respect thereof, shall be exempt from Sierra Leone tax. (3) The term "annuity" means a stated sum payable periodically at 11. A professor or teacher from one of the territories who receives remuneration for teaching, during a period of temporary residence not exceeding two years, at a university, college, school or other educational institution in 12. A student or business apprentice from one of the territories who is receiving full-time education or training in the other territory shall be exempt 13. (1) Subject to the provisions of the law of Sierra Leone regarding the allowance as a credit against Sierra Leone tax oftax payable in a territory outside Si~rra Leone, Canadian tax payable in respect of income from sources within Canada shall be allowed as a credit against any Sierra Leone tax payable in respect of that income. Where such income is an ordinary dividend paid by a Canadian debtor, the credit shall take into account (in addition to any Canadian income tax chargeable directly or by deduction in respect of the dividend) the Canadian income tax payable in respect of its profits by the company paying the dividend, and where it is a dividend paid on participating preference shares and representing both a dividend at a :fixed rate to which the shares are entitled and an additional participation in profits, the Canadian income tax so payable by the company shall likewise be taken into account in so far as the dividend exceeds that' fixed rate. (2) For the purposes of the foregoing paragraph and of the aforesaid provisions of the law of Sierra Leone, so much of the tax chargeable under the law of Canada relating to excess profits tax as is chargeable otherwise than by reference to excess profits shall be treated as income tax and not as excess profits tax. 2172 Cap. 273] Income Tax (3) Subject to the provisions of the law of Canada regarding the deduction from tax payable in Canada of tax paid in a territory outside Canada, Sierra Leone tax payable in respect of income from sources within Sierra Leone shall be deducted from any Canadian tax payable in respect of that income Where such income is an ordinary dividend paid by a company resident i~ Sierra Leone, the deduction shall take into account (in addition to any Sierra Leoue income tax appropriate to the dividend) the Sierra Leone contribution payable by the company in respect of its profits, and where it is a dividend paid on participating preference shares and representing both a dividend at the fixed rate to which the shares are entitled and an additional participation in profits, the national defence contribution so payable by the company shall likewise be taken into account in so far as the dividend exceeds that fixed rate. (4) For the purposes of this paragraph, profits or remuneration for personal (including professional) services performed in one of the territories shall be deemed to be income from sources within that territory, and the services of an individual whose services are wholly or mainly performed in ships or aircraft operated by a resident of one of the territories shall be deemed to be performed in that territory. 14. (1) The taxation authorities of Canada and Sierra Leone shall exchange such information (being information available under the respective taxation laws) as is necessary for carrying out the provisions of this Arrangement or for the prevention of fraud or the administration of statutory provisions against legal avoidance in relation to the taxes which are the subject of this Arrangement. Any information so exchanged shall be treated as secret and shall not be disclosed to any persons other than those concerned with the assessment and collection of the taxes which are the subject of this Arrangement. No information shall be exchanged which would disclose any trade secret or trade process. (2) The taxation authorities of Canada and Sierra Leone may consult together as may be necessary for the purpose of carrying out the provisions of this Arrangement and, in particular, the provisions of paragraphs 3 and 4. (3) As used in this paragraph, the term "taxation authorities" means, in the case of Canada, the Minister of National Revenue or his authorised representative; in the case of Sierra Leone, the Commissioner of Income Tax or his authorised representative. 15. This Arrangement shall_ come into force on the date on which the last of all such things shall have been done in Sierra Leone and Canada as are necessary to give the Arrangement the force of law in Sierra Leone and Canada respectively, and shall thereupon have effect- (a) in Sierra Leone as respects income tax for the year of assessment beginning on the 1st day of April, 1951, and subsequent years. (b) in Canada as respects income taxes, including surtaxes, for the taxation year 1951 and subsequent years, and as respects excess profits tax for any fiscal period beginning on or after the first day of January, 1951, and for the unexpired portion of any fiscal period current at that date. 16. This Arrangement shall continue in effect until terminated by the Government of the United Kingdom or the Government of Canada in accordance with an Agreement made between those Governments on the 5th day of June, 1946. Double Taxation Relief(New Zealand) [Cap. 21a NEW ZEALAND. (NEW ZEALAND) ORDER. 1. This Order may be cited as the Income Tax (Double Taxation Relief) (New Zealand) Order in Council, 1953. 2. It is hereby declared- (a) that the arrangements specified in the Arrangement set out in the Schedule to this Order have been made with the Government of New Zealand with a view to affording relief from double taxation in relation to tax imposed under the provisions of the Income Tax Ordinance, and taxes of a similar character imposed by the laws of New Zealand; and (b) that it Is expedient that those arrangements should ARRANGEMENT BETWEEN THE GOVERNJI-IENT OF SIERRA LEONE AND THE GovERNMENT OF NEw ZEALAND FOR THE A VOIDANCE OF DOUBLE TAXATION AND THE . PREVENTION OF FISCAL EvASION WITH RESPECT TO TAXES ON INCOME. 1. (I) The taxes which are the subject of this Arrangement are- (a) In New Zealand : The income tax and the social security charge (hereinafter referred to as "New Zealand tax"). · The imcome tax (hereinafter referred to as " Sierra Leone tax"). stantially similar character imposed in New Zealand or Sierra Leone after this Arrangement has come into force. 2. (I) In this Arrangement, unless the context otherwise requires- (a) The term" Sierra Leone" means the Colony and Protectorate of (b) The term " New Zealand" includes all islands and territories within the limits thereof for the time being, including the Cook Islands. (c) The terms " one of the territories" and " the other territory" mean Sierra Leone or New Zealand, as the context requires. (d) The term " tax" means Sierra Leone tax or New Zealand tax, as the context requires. S.L.-VoL. VIH-32 15 of 1953. 2174 Cap. 273] Income Tax (e) The term" person" includes any body of persons, corporate or (j) The term" company" means any body corporate. (g) The terms " resident of Sierra Leone " and " resident of New Zealand " mean respectively any person who is resident in Sierra Leone for the purposes of.Sierra Leone tax and not resident in New Zealand for the purposes of New Zealand tax and any person who is resident in New Zealand for the purposes of New Zealand tax and not resident in Sierra Leone for the purposes of Sierra Leone tax; and a company shall be regarded as resident in Sierra Leone and not resident in New Zealand if its business is managed and controlled in Sierra Leone and as resident in New Zealand and not resident in Sierra Leone if its business is managed and controlled in New Zealand. (h) The terms "resident of one of the territories" and " resident of the other territory " mean a person who is a resident of Sierra Leone or a person who is a resident of New Zealand, as the context requires. (i) The terms "Sierra Leone enterprise" and "New Zealand undertaking carried on by a resident of Sierra Leone and an industrial or commercial enterprise or undertaking carried on by a resident of New Zealand; and the terms "enterprise of one of the territories" and " enterprise of the other territory " mean a Sierra Leone enterprise or a New Zealand enterprise, as the context requires. (j) The term " industrial or commercial enterprise or undertaking " includes an enterprise or undertaking engaged in mining, agricultural or pastoral activities, or in the business of banking, insurance, life insurance or dealing in investments, and the term" industrial or commercial profits " includes profits from such activities or business but does not include income in the form of dividends, interest, rents, royalties, management charges, or remuneration for personal services. (k) The term" permanent establishment", when used with respect to an enterprise of one of the territories, means a branch, management, factory, mine, farm, or other fixed place of business, but does not include an agency in the other territory unless the agent has, and habitually exercises, a general authority to negotiate and conclude contracts on behalf of such enterprise or regularly fills orders on its behalf from a stock of goods or merchandise in that other territory. An enterprise of one of the territories shall not be deemed to have a permanent establishment in the other territory merely because it carries on business dealings in that other territory through a bona fide broker or general commission agent acting in the ordinary course of his business as such and receiving remuneration in respect of those dealings at a rate not less than that customary in the class of business in question. The fact that an enterprise of one of the territories maintains in the other territory a fixed place of business exclusively for the purchase 6f goods or merchandise s)lall not of itself constitute that fixed place of business a permanent establishment of the enterprise. The fact that a company which is a resident of one of the territories has a subsidiary company which is a resident of the other territory or which is engaged in trade or business in that other territory (whether constitute that subsidiary company a permanent establishment of its parent company. Double Taxation Relief (New Zealand) [Cap. 273 (2) The terms" New Zealand tax" and" Sierra Leone tax", as used in this Arrangement, do not include any tax payable in New Zealand or Sierra Leone which represents a penalty imposed under the law of New Zealand or Sierra Leone relating to the taxes which are the subject of this Arrangement. (3) In the application of the provisions of this Arrangement by New Zealand or Sierra Leone any term not otherwise defined shall, unless the context otherwise requires, have the meaning which it has under the laws of New Zealand, or, as the case may be, Sierra Leone, relating to the taxes which are the subject of this Arrangement. 3. (1) The industrial or commercial profits of a Sierra Leone enterprise shall not be subject to New Zealand tax unless the enterprise is engaged in trade or business in New Zealand through a permanent establishment situated therein. If it is so engaged, tax may be imposed on those profits by New Zealand, but only on so much of them as is attributable to that permanent establishment: Provided that nothing in this sub-paragraph shall affect any provisions of the law of New Zealand regarding the taxation of income from the business of insurance. (2) The industrial or commercial profits of a New Zealand enterprise trade or business in the Colony through a permanent establishment situated therein. It if is so engaged, tax may be imposed on those profits by Sierra Leone, but only on so much of them as is attributable to that permanent (3) Where an enterprise of one of the territories is engaged in trade or therein, there shall be attributed to that permanent establishment the industrial or commercial profits which it might be expected to derive in that other territory if it were an independent enterprise engaged in the same or similar activities and its dealings with the enterprise of which it is a permanent establishment were dealings at arm's length with that enterprise or an independent enterprise; and the profits so attributed shall be deemed to be income derived from sources in that other territory. If the information available to the taxation authority concerned is inadequate to determine the profits to be attributed to the permanent establishment, nothing in this sub-paragraph shall affect the application of the law of either territory in relation to the liability of the permanent establishment to pay tax on an amount determined by the exercise of a discretion or the making of an estimate by the taxation authority of that territory: Provided that such discretion shall be exercised or such. estimate shall be made, so far as the information available to the taxation authority permits, in accordance with the principle stated in this sub-paragraph. (4) Profits derived by an enterprise of one of the territories from sales, under contracts concluded in that territory, of goods or merchandise stocked in a warehouse in the other territory for convenience of delivery and not for purposes of display shall not be attributed to a permanent establishment of the enterprise in that either territory, notwithstanding that the offers of purchase have been obtained by an agent of the enterprise in that other territory and transmitted by him to the enterprise for acceptance. (5) No portion of any profits arising from the sale of goods or merchandise by an enterprise of one of the territories shall be attributed to a permanent establishment situated in the other territory by reason of the mere purchase of the goods or merchandise within that other territory. S.L.-VoL. VIII-32* 2176 Cap. 273] Income Tax 4. (1) Whereother territory or enterprise of the other territory and (c) in either case conditions are operative between the two enterprises in their commercial or financial relations which differ from those which might be expected to operate between independent enterprises dealing at arm's length with one another. · then, if by reason of those conditions profits which might be expected to accrue to one of the enterprises do not accrue to that enterprise, there may be included in the profits of that enterprise the profits which would have accrued to it if it were an independent enterprise and its dealings with the other enterprise were dealings at arm's length with that enterprise or an independent enterprise. (2) Profits included in the profits of an enterprise of one of the territories under sub-paragraph (1) of this paragraph shall be deemed to be income derived from sources in that territory and shall be taxed accordingly. (3) If the information available to the taxation authority concerned is inadequate to determine, for the purposes of sub-paragraph (1) of this paragraph the profits which might be expected to accrue to an enterprise, nothing in that sub-paragraph shall affect the application of the law of either territory in relation to the liability of that enterprise to pay tax on an amount determined by the exercise of a discretion or the making of an estimate by the taxation authority of that territory: Provided that such discretion shall be exercised or such estimate shall be made, so far as the information available to the taxation authority permits, in accordance with the principle stated in that sub-paragraph. 5. Notwithstanding the provisions of paragraphs 3 and 4, profits which 6. (1) Dividends paid by a company resident in one of the territories to a territory through a permanent . establishment situated therein, shall be exempt from any tax in that first-mentioned territory which is chargeable on dividends in addition to the tax chargeable in respect of the profits or income of the company: Provided that dividends paid by a company resident in New Zealand to a person who is a resident of Sierra Leone may be included in that person's total income for the purposes of determining the amount of any New Zealand tax payable in respect of income of that person other than such dividends. that other territory shall not impose any form of taxation on dividends paid by the company to persons not resident in that other territory, or any tax in the nature of an undistributed profits tax on undistributed profits of the company, by reason of the fact that those dividends or undistributed profits represent, in whole or in part, profits or income so derived. Double Taxation Relief (New Zealand) [Cap. 273 7. (1) Any royalty derived from sources within one of the territories by a territory through a permanent establishment situated therein, shall be exempt from tax in that first-mentioned territory but no exemption shall be allowed under this paragraph in respect of so much of any such royalty as exceeds an amount which represents a fair and reasonable consideration for the rights for which the royalty is paid. (2) In this paragraph the term "royalty" means any royalty or other property, but does not include royalties or other amounts paid in respect of the operation of mines or quarries or of the extraction or removal of timber or other natural resources or rents or royalties in respect of motion picture films. 8. (1) Remuneration (other than pensions) paid by the Government of one of the territories to any individual for services rendered to that Government in the discharge of governmental functions shall be exempt from tax in the territory of the other Governmjlnt if the individual is not ordinarily resident in that territory or is ordinarily resident in that territory solely for the purpose of rendering those services. (2) The provisions of this paragraph shall not apply to payments in respect of services rendered in connection with any trade or business carried on by either of the Governments for purposes of profit. 9. (1) An individual who is a resident of Sierra Leone shall be exempt from New Zealand tax on profits or remuneration in respect of personal (including professional) services performed within New Zealand in any income year if- (a) he is present within New Zealand for a period or periods not (2) An individual who is a resident of New Zealand shall be exempt from Sierra Leone tax on profits or remuneration in respect of personal (including professional) services performed within Sierra Leone in any year of assessment in New Zealand, and (c) the profits or remuneration are subject to New Zealand tax. 10. (1) Any pension or annuity, derived from sources within one of the territories by an individual who is a resident of the other territory and liable to tax in that other territory in respect thereof, shall be exempt from tax in the first-mentioned territory. 2178 Cap. 273] Income Tax (2) The term " annuity " means a stated sum payable periodically at stated times, during life or during a specified or ascertainable period of time under an obligation to make the payments in consideration of money paid. ' 11. A professor or teacher from one of the territories who receives remuneration for tea?hin~, during a period of temporary resi~ence 1_10t ~xceeding two years, at a umvers1ty, college, school or other educatiOnal mst1tution in 12. A student or business or trade apprentice from one of the territories who is receiving full-time education or training in the other territory shall be exempt from tax in that other territory on payments made to him by persons in the first-mentioned territory for the purposes of his maintenance, education or training. 13. Income of a person who is a resident of Sierra Leone (other than dividends paid by a company resident in New Zealand) which is exempt from New Zealand tax under any provision of this Arrangement shall not be included in that person's total income for the purposes of determining the amount of any New Zealand tax payable in respect of income of that person which is assessable to New Zealand tax. 14. (1) Subject to the provisions of the law of Sierra Leone regarding the allowance as a credit against Sierra Leone tax of tax payable in a territory outside Sierra Leone, New Zealand tax payable, whether directly or by deduction, in respect of income from sources within New Zealand shall be allowed as a credit against any Sierra Leone tax payable in respect of that income. Where such income is an ordinary dividend paid by a company resident in New Zealand, the credit shall take into account the New Zealand tax payable in respect of its profits by the company paying the dividend, and where it is a dividend paid on participating preference shares and representing both a dividend at the fixed rate to which the shares are entitled and an additional participation in profits, the New Zealand tax so payable by the company shall likewise be taken into account in so far as the dividend exceeds that fixed rate. For the purposes of this paragraph any amount which is included in a person's taxable income under any provision of the J,aw of New Zealand regarding the taxation of income from the business of insurance shall be deemed to be derived from sources in New Zealand. (2) Where New Zealand tax is payable in respect of income derived from sources in Sierra Leone by a person who is a resident of New Zealand, being income in respect of which Sierra Leone tax is payable, whether directly or by deduction, the Sierra Leone tax so payable (reduced by the amount of any relief or repayment attributable to that income to which that person is entitled under the Law of Sierra Leone) shall, subject to such provisions (which shall not affect the general principle hereof) as may be enacted in New Zealand, be allowed as a credit against the New Zealand tax (other than the social security charge) payable in respect of that income: Provided that where. the income is a dividend paid by a company resident in Sierra Leone the credit shall be allowed only if the recipient elects for the purposes of this paragraph to have the amount of such dividend together with the Sierra Leone tax (as so reduced) included in his assessable income for the purposes of New Zealand tax. (3) For the purposes of this paragraph profits or remuneration for personal (including professional) services performed in one of the territories shall be deemed to be income from sources within that territory, and the services of an individual whose services are wholly or mainly performed in ships or aircraft operated by a resident of one of the territories shall be deemed to be performed in that territory. 15. (1) The taxation authorities of New Zealand and Sierra Leone shall exchange such information (being information available under their respective taxation laws) as is necessary for carrying out the provisions of this Arrangement or for the prevention of fraud or for the administration of statutory provisions against legal avoidance in relation to the taxes which are the subject of this Agreement. Any information so exchanged shall be treated as secret and shall not be disclosed to any persons other than persons (including a Court) concerned with the assessment or collection of, or the determination of appeals in relation to the taxes which are the subject of this Arrangement. No information shall be exchanged which would disclose any trade secret or trade process. (2) As used in this paragraph, the term " taxation authorities " means, in the case of New Zealand, the Commissioner of Taxes or his authorised representative; in the case of Sierra Leone, the Commissioner of Income Tax or his authorised representative. 16. This Arrangement shall come into force on the date on which the last of all such things shall have been done in Sierra Leone and New Zealand as are necessary to give the Arrangement the force of law in Sierra Leone and New Zealand respectively, and shall thereupon have effect- (a) in Sierra Leone as respects income tax for the year of assessment beginning on the 1st day of April, 1951, and subsequent years. (b) in New Zealand, as respects income tax for the year of assessment beginning on the 1st day of April, 1951, and subsequent years; as respects social security charge on salaries and wages as from the 1st day of April, 1951; and as respects social security charge on income other than salaries and wages for the financial year beginning on the 1st day of April, 1950, and subsequent years. ... -