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HMRC internal manual

Double Taxation Relief Manual

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HM Revenue & Customs
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DT: Swaziland: double taxation agreement, Article 21: 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) Swaziland tax payable under the laws of Swaziland and in accordance with this Agreement, whether directly or by deduction, on profits, income or chargeable gains from sources within Swaziland (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 Swaziland tax is computed;
(b) in the case of a dividend paid by a company which is a resident of Swaziland 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 paving the dividend, the credit shall take into account (in addition to any Swaziland tax creditable under sub-paragraph (a) of this paragraph) the Swaziland tax payable by the company in respect of the profits out of which such dividend is paid.
(2) Where United Kingdom tax is payable under the laws of the United Kingdom and in accordance with this Agreement, whether directly or by deduction, in respect of profits, income or chargeable gains derived from sources within the United Kingdom by a resident of Swaziland, and that tax is borne by him, Swaziland shall either impose no tax on such profits, income or chargeable gains or, subject to such provisions (which shall not affect the general principle hereof) as may be enacted in Swaziland, shall allow the United Kingdom tax as a credit against any Swaziland tax payable in respect of such profits, income or chargeable gains. Where such income is a dividend paid by a company which is a resident of the United Kingdom to a company which is a resident of Swaziland and which controls directly or indirectly at least 10 per cent. of the voting power in the United Kingdom company, any such credit shall take into account (in addition to any United Kingdom tax creditable under the preceding provisions of this paragraph) the United Kingdom tax payable by the company in respect of the profits out of which such dividend is paid.

(3) For the purposes of paragraphs (1) and (2) 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 Agreement shall be deemed to arise from sources in that other State.

(4) 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 Contracting State and the profits so included are profits which would have accrued to that enterprise of the other Contracting 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 Contracting State of the enterprise of the first-mentioned State and relief shall be given accordingly under paragraph (1) or paragraph (2) of this Article.