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HMRC internal manual

Double Taxation Relief Manual

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HM Revenue & Customs
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DT: Sudan: double taxation agreement, Article 23: Elimination of double taxation

(1) Subject to the provisions of the law of the United Kingdom regarding the allowance as a credit against United Kingdom tax of tax payable in a territory outside the United Kingdom (which shall not affect the general principle hereof):
(a) Sudan tax payable under the laws of the Sudan and in accordance with this Convention, whether directly or by deduction, on profits, income or chargeable gains from sources within the Sudan (excluding in the case of a dividend tax payable in respect of the profits out of which the dividend is paid) shall be allowed as a credit against any United Kingdom tax computed by reference to the same profits, income or chargeable gains by reference to which the Sudan tax is computed;
(b) in the case of a dividend paid by a company which is a resident of the Sudan to a company which is a resident of the United Kingdom and which controls directly or indirectly at least 10 per cent of the voting power in the company paying the dividend, the credit shall take into account (in addition to any Sudan tax creditable under the provisions of sub-paragraph (a) of this paragraph) the Sudan tax payable by the company in respect of the profits out of which such dividend is paid.
(2) For the purposes of paragraph (1) of this Article, Sudan tax payable shall be deemed to include any amount which would have been payable as Sudan tax but for an exemption or reduction of tax which is certified by the competent authority for the Sudan as having been given with a view to encouraging industrial, commercial, agricultural, scientific or educational development under:

(i) The Development and Promotion of Industrial Investment Act,1974 of the Sudan, or the Organisation and Encouragement of Investment in Economic Services Act,1972 of the Sudan insofar as they were in force on and have not been modified since the date of signature of the present Convention or have been modified only in minor respects so as not to affect their general character; or
(ii) any other provision which may subsequently be made granting an exemption or reduction of tax which is agreed by the competent authorities of the Contracting States to be of a substantially similar character, if it has not been modified thereafter or has been modified only in minor respects so as not to affect its general character.

(3) Where a resident of the Sudan derives profits income or capital gains from sources within the United Kingdom, which may be taxable in the United Kingdom in accordance with the provisions of this Convention, the amount of the United Kingdom tax payable in respect of those profits income or capital gains shall be allowed as a credit against Sudan tax imposed on that resident provided

(i) that the amount of credit shall not exceed that part of the Sudan tax which is appropriate to those profits or income or as the case may be those capital gains and
(ii) that in the case of a dividend, tax payable in respect of the profits out of which the dividend is paid, shall be so allowed only if the dividend is paid to a company which controls directly or indirectly at least ten per cent of the voting power in the company paying the dividend.

(4) For the purposes of paragraphs (1), (2) and (3) of this Article income, profits and capital gains owned by a resident of a Contracting State which may be taxed in the other Contracting State in accordance with this Convention shall be deemed to arise from sources in that other Contracting State.
(5) Where profits on which an enterprise of a Contracting State has been charged to tax in that State are also included in the profits of an enterprise of the other State and the profits so included are profits which would have accrued to that enterprise of the other State if the conditions made between the enterprises had been those which would have been made between independent enterprises dealing at arm’s length, the amount included in the profits of both enterprises shall be treated for the purposes of this Article as income from a source in the other State of the enterprise of the first- mentioned State and relief shall be given accordingly under the provisions of paragraphs (1), (2) or (3) of this Article.
(6) The competent authorities of the Contracting States shall consult together if necessary to consider how any tax charged on capital by one Contracting State may be allowed as a credit against tax charged on capital by the other Contracting State.