This Convention applies to persons who are residents of one or both of the Contracting States. Where, by virtue of the provisions of paragraph 1 of this Article, a person other than an individual is a resident of both Contracting States, he shall be deemed to be a resident only of the State in which his place of effective management is situated is.
Income from immovable property
The provisions of paragraphs 1 and 3 of this Article shall also apply to income from immovable property of a business and to income from immovable property used for the provision of independent personal services.
Business profits
Also, in determining the profits of a permanent establishment, the amounts charged (other than reimbursement of actual expenses) from the permanent establishment to the head office of the enterprise or to any of its other offices, by means of royalties, fees or other similar payments in exchange for the use of patents or other rights, or by way of commission for particular. For purposes of the preceding paragraphs of this article, the profits to be attributed to the permanent establishment shall be determined by the same method year after year, unless there is good and sufficient reason to the contrary.
Shipping and air transport
Associated enterprises
Where a Contracting State includes in the profits of an enterprise of that State - and taxes accordingly - profits which an enterprise of another Contracting State is liable to tax in that other State, and the profits thus included are profits which would have been attributed to the enterprise of the first-mentioned State if the conditions had been , entered into between the two companies, are the same as those which would have been entered into between the two independent enterprises, then that other country shall make a corresponding adjustment to the amount of tax charged in it on those profits. When determining such adjustment, other provisions of this Convention must be duly taken into account and the competent authorities of the Contracting States shall consult each other as necessary.
Dividends
The term 'dividends' as used in this article means income from shares, profit shares or profit rights, mining shares, founders' shares or other rights, other than debt claims, that participate in profits, as well as income from other corporate rights that are subject to the same tax treatment as income of shares in accordance with the laws of the state of which the company making the distribution is a resident. The provisions of paragraphs 1 and 2 of this Article 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 or fixed base established therein, or carries out independent personal services in that other State from a fixed base situated therein, and the shareholding in respect of which the dividends are paid is effectively connected with such permanent establishment or fixed base. Where a company which is a resident of a Contracting State derives profits or income from the other Contracting State, this is the case.
Income from debt-claims
The term "income from debt claims", as used in this article, means income from debt claims of all kinds, whether or not they are secured by a mortgage and whether or not they are entitled to participate in the debtor's profits, and in particular income from government securities and income from bonds or debentures, including premiums and rewards related to such securities, bonds or debentures. The provisions of the first and second paragraphs of this article do not apply if the rightful owner of the income from debt claims, who is a resident of the Contracting State, does business in another Contracting State in which the income from debt claims arises. through a permanent establishment there, or provides independent personal services in that other country from a permanent base there, and the debt claim in respect of which the income from the debt claims is paid is effectively connected to such a permanent establishment or permanent base. Income from debt claims is deemed to arise in a Contracting State if the payer is a resident of that State.
Royalties
If, due to a special relationship between the payer and the rightful owner or between both of them and another person, taking into account the debt claim for which it is paid, the amount of income exceeds the amount that would have been agreed between the payer and the rightful owner in in the absence of such a relationship, the provisions of this article shall only apply to the latter amount. 5 per cent of the gross amount of the royalties paid for the use of, or the right to use, industrial, commercial or scientific equipment; or. If, due to a special relationship between the payer and the rightful owner or between both of them and another person, taking into account the use, right or information for which they are paid, the amount of the royalty exceeds the amount that would have been agreed between the payer and the rightful owner in the absence of such a relationship, the provisions of this article shall apply only to the latter amount.
Capital gains
Gains derived by a resident of a Contracting State from the alienation of shares 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, other than those to which paragraph 4 of this Article applies, derived by a resident of a Contracting State from the alienation of shares of an unlisted company which is a resident of the other Contracting State may be taxed in that other State. if the alienator owned directly or indirectly at least 10 percent of the capital of that company at any time during the twelve-month period preceding the alienation. However, the tax so charged by the other Contracting State shall not exceed 15 percent of the profits.
Independent personal services
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.
Dependent personal services
Notwithstanding the foregoing provisions of this Article, remuneration derived in respect of an employment exercised on board a ship or aircraft operated in international traffic may be taxed in the Contracting State in which the place of effective management of the enterprise is situated.
Directors' fees
Artistes and sportspersons
If income from personal activities exercised by an artist or sportsperson in his capacity as such does not accrue to the artist or sportsperson himself, but to another person, such income may, notwithstanding the provisions of Articles 7, 14 and 15 of this Convention, shall be taxed in the Contracting State in which the activities of the entertainer or sportsperson are exercised. In such case, the income shall be taxable only in the Contracting State of which the entertainer or sportsperson is a resident.
Pensions
Government service
Notwithstanding the provisions of paragraph 1 of this Article, pensions and other similar remuneration paid by, or from funds created by, a Contracting State or a political or administrative subdivision or a local authority thereof to an individual in respect of services rendered to that State or subdivision or authority is taxable only in that State. However, such pensions and other similar remuneration are taxable in the other Contracting State only if the individual is a resident of and a citizen of that State. The provisions of Articles and 18 of this Convention 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 or a political or administrative subdivision or a local its authority is operated. .
Students
Teachers and Researchers
Other income
Capital
Elimination of double taxation
Where a resident of the Kingdom of Saudi Arabia has income or owns capital which, in accordance with the provisions of this Convention, may be taxed in Switzerland, then the Kingdom of Saudi Arabia shall allow: However, such deduction in each case shall not shall exceed that part of the income tax or capital tax, as calculated before the deduction is given, which is attributable, as the case may be, to income or capital chargeable to tax in Switzerland. In the case of the Kingdom of Saudi Arabia, the methods for eliminating double taxation shall not prejudice the provisions of the Zakat collection regime.
Mutual agreement procedure
They may also consult on the elimination of double taxation in cases not provided for in this convention. The competent authorities of the Contracting States may communicate with each other, including through a joint commission composed of themselves or their representatives, in order to reach an agreement in terms of the preceding paragraphs. The competent authorities of the Contracting States may, by mutual agreement, determine the appropriate manner of application of this Convention and, in particular, the requirements that must apply to residents of the Contracting State in order to obtain tax relief in the other State. or exceptions provided for in this Convention.
Exchange of information
Notwithstanding the foregoing, information received by a Contracting State may be used for other purposes where such information may be used for such other purposes under the laws of both States and the competent authority of the providing State permits such use. The obligation contained in the preceding sentence shall be subject to the limitations of paragraph 3 of this Article, but in no case shall these limitations be construed as permitting a Contracting State to refuse to provide information solely because it has no domestic interest in has such information. In no event shall the provisions of paragraph 3 of this Article be construed as permitting a Contracting State to refuse to supply information solely because the information is in the possession of a bank, other financial institution, trust, nominee or person who acts in an agency or a fiduciary capacity. capacity or because it relates to ownership interests in a person.
Members of diplomatic missions and consular posts
Miscellaneous provisions
Nothing in this Convention shall affect the application of domestic provisions to prevent fiscal evasion and tax avoidance against abuse of this Convention. When applying such provisions, however, the rules of paragraph 1 of this article shall be taken into account.
Entry into force
Termination
Ueli Maurer Minister of Finance
PROTOCOL
Re Article 7 of the Treaty: . It is understood that the expression “business profits” includes, but is not limited to, income from manufacturing, trade, banking, insurance, from the operation of domestic transport, the provision of services and the rental of tangible movable property . It is understood that the Contracting States will only exchange information relating to taxable years beginning on or after the first day of January in the calendar year following the entry into force of the Agreement. It is understood that the purpose of the last part of the paragraph is to provide the person who would otherwise be denied the benefits with the opportunity to prove that obtaining the benefit under the concrete circumstances would be in accordance with the object and purpose of the Treaty.
