This Convention shall apply to taxes on income and on capital imposed on behalf of a Contracting State or its political subdivisions or local authorities, regardless of the manner in which they are imposed. This Convention shall apply to persons who are residents of one or both of the Contracting States. Where, by reason of the provisions of paragraph (1) of this Article, a person other than an individual is a resident of both Contracting States, then he shall be deemed to be a resident only of the State in which his place of effective administration is situated . .
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 ), neither company shall in itself constitute a permanent establishment of the other. The term “immovable property” has the meaning given to it in the laws of the Contracting State in which the property in question is situated. If the enterprise carries on the activities referred to above, the profits of the enterprise may be taxed in the other State, but only to the extent attributable to that permanent establishment.
In determining the profits of a permanent establishment, expenses incurred for the purposes of the permanent establishment are allowed as deductions, including executive and general administrative expenses so incurred, either in the Contracting State in which the permanent establishment is situated or elsewhere. However, no such deduction shall be allowed in respect of amounts, if any, paid (other than for reimbursement of actual expenses) by the permanent establishment to the head office of the company or any of its other offices, by way of royalties, fees or other similar payments in exchange for the use of patents or other rights, or by way of commission, for specific services performed or for management, or, except in the case of a banking enterprise, by way of income from debt in respect of to monies lent to the permanent cause. No profits shall be attributed to a permanent establishment of an enterprise of a Contracting State by reason of the mere purchase by that permanent establishment of goods or merchandise for that establishment.
Article (8(
Shipping and Air Transport
Article (9(
Associated Enterprises
Where a Contracting State includes in the profits of an enterprise of that State - and taxes thereon - profits on which an enterprise of the other Contracting State is taxed in that other State and the profits so included are profits which would the enterprise of the first-mentioned State had been aggregated if the conditions established between the two enterprises had been those which would have been established between independent enterprises, then that other State shall make an appropriate adjustment to the amount of tax charged therein on those profits. In determining such regulation, due regard shall be paid to the other provisions of this Convention and the competent authorities of the Contracting States shall, if necessary, consult each other.
Article (10(
Dividends
The provisions of the first and second paragraphs of this article do not apply if the beneficial owner of the dividends, who is a resident of the Contracting State, does business in another Contracting State, whose company is the company that pays the dividends. resident through a permanent establishment there or performs in that other country independent personal services from a permanent base there and the share in respect of which the dividends are paid is effectively connected with such permanent establishment or permanent base. In such a case, the provisions of Article 7 or Article 14 of this Convention shall apply, depending on the case. If a company which is a resident of a Contracting State derives profits or income from another Contracting State, that other State shall not impose any tax on dividends paid by the company unless such dividends are paid to a resident of that other State. country or to the extent that the interest in respect of which the dividends are paid is actually connected with a permanent establishment or a fixed base in that other country, nor subject the retained earnings of the company to retained earnings tax, even if the dividends paid or retained earnings are in consisting wholly or partly of profits or income arising in such other country.
Article (11(
Income from Debt-Claims
The provisions of paragraph (1) of this Article shall not apply if the beneficial owner of the debt income, being a resident of a Contracting State, carries on a business in the other Contracting State in which the debt income arises. through a permanent establishment situated therein, or provides independent personal services in that other State from a fixed base situated therein, and the debt-claim in respect of which the income from debt-claims is paid is effectively connected with such permanent establishment or permanent establishment. base. In such case, the provisions of Article 7 or 14 of this Agreement, as appropriate, shall apply. When, as a result of a special relationship between the payer and the beneficial owner or between both of them and another person, the amount of income from claims, for whatever reason, exceeds the amount that would have been agreed upon by the payer and the beneficial owner, in the absence of such a relationship, the provisions of this article shall apply only to the latter amount.
In such case, the excess part of the payments shall remain taxable according to the laws of each Contracting State, with due regard to the other provisions of this Convention.
Article (12(
Royalties
Royalties are deemed to arise in a Contracting State when the payer is a resident of that State. Where, however, the person paying the royalty, whether or not he is a resident of a Contracting State, has in a Contracting State a permanent establishment or a fixed base in connection with which the liability to pay the royalty was incurred , and such royalties are borne by such permanent establishment or fixed base, such royalties shall be deemed to arise in the Contracting State in which the permanent establishment or fixed base is situated. Where, as a result of a special relationship between the payer and the beneficial owner or between both of them and another person, the amount of the royalty paid, for whatever reason, exceeds the amount that the payer and the beneficial owner in the absence of such a relationship, the provisions of this Article only apply to the latter amount.
Article (13(
Capital Gains
Gains derived by a resident of a Contracting State from the alienation of shares or similar interests deriving more than 50 percent of their value directly or indirectly from immovable property situated in the other Contracting State may be taxed in that other State. Gains from the alienation of shares other than those mentioned in paragraph 4 of this Article representing a holding of 25 percent or more in a company which is a resident of a Contracting State may be taxed in that State. Gains from the alienation of property other than that referred to in the preceding paragraphs of this Article shall be taxable only in the Contracting State of which the alienator is a resident.
Article (14(
Independent Personal Services
Article (15(
Dependent Personal Services
Article (16(
Directors’ Fees
Article (17(
Artistes and Sportspersons
Article (18(
Pensions
Article (19(
Government Service
Article (20(
Students
Article (21(
Teachers and Researchers
Article (22(
Other Income
Article (23(
Capital
Article (24(
Elimination of Double Taxation
Article (25(
Mutual Agreement Procedure
Article (26(
Exchange of Information
If information is requested by a Contracting State in accordance with this article, the other Contracting State shall use its own information-gathering measures to obtain the information requested, even though that other State may not need such information for the purposes his tax. The obligation contained in the preceding sentence is subject to the limitations of paragraph (3) of this Article, but in no case shall such limitations be construed to permit a Contracting State to refuse to provide information solely because it has no intrinsic interest in the information. such.
Article (27(
Diplomatic and Consular Officers
Article (28(
Miscellaneous Provisions
Article (29(
Entry into Force
Article (30(
Termination
PROTOCOL
Such term does not include the performance of personal services by an individual either as an employee or in an independent capacity. However, if the profits are chargeable to the United Kingdom under paragraphs 1, 2 or 3 of article 13, the Kingdom of Saudi Arabia and not the United Kingdom shall eliminate double taxation in accordance with the methods set out in paragraph 2 of article 24. For the purposes of the United Kingdom relief for Saudi Arabia, it is understood that, that Saudi nationals resident in the United Kingdom are liable to pay income tax in the Kingdom of Saudi Arabia on their income from sources there, and therefore such persons will only be entitled to credit in the United Kingdom for the income tax payable to the Kingdom of Saudi Arabia for their income from sources there.
Having regard to the Agreement between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of the Kingdom of Saudi Arabia for the reciprocal avoidance of double taxation on income derived from international air transport activities and on Remuneration of Employees of Enterprises Carrying on Such Activities, signed at Riyadh on March 10, 1993, it is understood that nothing in this Agreement shall affect the provisions of that Agreement to the extent that they have effects with respect to taxes subject to this Agreement applies. However, where any provision of this Agreement provides greater relief from such taxes, that provision shall apply. Done in duplicate at London, this 31st day of October, 2007. Corresponds to h in the Arabic and English languages, both texts being equally authoritative.
