DT Agreements: Australia - Income from a UK source paid to a resident of Australia
UK interest paid to a resident of Australia
From 1 July 2004: Article 11 of the 2003 Convention
UK interest paid after 1 July 2004 to a resident of Australia who is the beneficial ownerof the interest is taxable in the UK at 10%.
But if the beneficial owner resident in Australia is either agovernmental or central banking body of Australia, or is a financial institution unrelatedto the payer, the interest may be paid without deduction of UK income tax. Theclaim/application form includes questions the answers to which should tell you if thisapplies.
Article 11.3(a) and 3(b) of the 2003 convention give a full definition of both types ofbody. But you should note that the term financial institution does notinclude a corporate treasury, or a member of a group performing financingservices for the group.
Before 1 July 2004: Article 9 of the 1968 Agreement
UK interest paid before 1 July 2004 to a resident of Australia who is the beneficial ownerof the interest is taxable in the UK at 10%, provided that:
- the interest is subject to tax in Australia, and
- the securities giving rise to the interest are not sold within 3 months of acquisition.