Australian Tax Treaties
Thai Agreement
AGREEMENT BETWEEN AUSTRALIA AND THE KINGDOM OF THAILAND FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME
ARTICLE 12
Royalties
1.
Royalties arising in one of the Contracting States, being royalties to which a resident of the other Contracting State is beneficially entitled, may be taxed in that other State.
2.
Such royalties may be taxed in the Contracting State in which they arise, and according to the law of that State, but the tax so charged shall not exceed 15 per cent of the gross amount of the royalties.
3.
The term " royalties " in this Article means payments or credits, whether periodical or not, and however described or computed, to the extent to which they are made as consideration for:
(a) the use of, or the right to use, any copyright, patent, design or model, plan, secret formula or process, trademark or other like property or right;
(b) the use of, or the right to use, any industrial, commercial or scientific equipment;
(c) the supply of scientific, technical, industrial or commercial knowledge or information;
(d) the supply of any assistance that is ancillary and subsidiary to, and is furnished as a means of enabling the application or enjoyment of, any such property or right as is mentioned in subparagraph (paragraph (a), any such equipment as is mentioned in subparagraph (paragraph (b) or any such knowledge or information as is mentioned in subparagraph (paragraph (c);
(e) the use of, or the right to use -
(f) total or partial forbearance in respect of the use of a property or right referred to in this paragraph.
4.
Income derived from the alienation of property or rights mentioned in paragraph 3 may be taxed in the Contracting State in which the income arises, but the tax so charged shall not exceed 15 per cent of the gross amount of the income.
5.
The provisions of paragraphs 1, 2 and 4 shall not apply if the person beneficially entitled to the royalties or the income mentioned in paragraph 4, being a resident of one of the Contracting States, carries on business in the other Contracting State, in which the royalties or income arise, through a permanent establishment situated therein, or performs in that other State independent personal services from a fixed base situated therein, and the right or property in respect of which the royalties or income are paid is effectively connected with such permanent establishment or fixed base. In such a case, the provisions of Article 7 or Article 14, as the case may be, shall apply.
6.
Royalties and the income mentioned in paragraph 4 shall be deemed to arise in a Contracting State when the payer is that State itself or a political or administrative subdivision of that State or a local authority of that State or a person who is a resident of that State for the purposes of its tax. Where, however, the person paying the royalties or income, whether the person is a resident of one of the Contracting States or not has in a Contracting State or outside both Contracting States a permanent establishment or fixed base in connection with which the liability to pay the royalties or income was incurred, and such royalties or income are borne by the permanent establishment or fixed base, then such royalties or income shall be deemed to arise in the State in which the permanent establishment or fixed base is situated.
7.
Where, owing to a special relationship between the payer and the person beneficially entitled to the royalties or the income mentioned in paragraph 4, or between both of them and some other person, the amount of the royalties or income paid, having regard to what they are paid for, exceeds the amount which might have been expected to have been agreed upon by the payer and the person so entitled in the absence of such relationship, the provisions of this Article shall apply only to the lastmentioned amount. In that case, the excess part of the amount of the royalties or income paid shall remain taxable according to the law of each Contracting State, but subject to the other provisions of this Agreement.
8.
For the purposes of this Article " paid " includes credited and " payer " and " person paying " have the corresponding meanings.
The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the MLI) has modified the application of this tax treaty. A synthesised text of the MLI and this tax treaty is available to facilitate the understanding of how the MLI modifies this tax treaty.
Royalties arising in one of the Contracting States, being royalties to which a resident of the other Contracting State is beneficially entitled, may be taxed in that other State.
2.
Such royalties may be taxed in the Contracting State in which they arise, and according to the law of that State, but the tax so charged shall not exceed 15 per cent of the gross amount of the royalties.
3.
The term " royalties " in this Article means payments or credits, whether periodical or not, and however described or computed, to the extent to which they are made as consideration for:
(a) the use of, or the right to use, any copyright, patent, design or model, plan, secret formula or process, trademark or other like property or right;
(b) the use of, or the right to use, any industrial, commercial or scientific equipment;
(c) the supply of scientific, technical, industrial or commercial knowledge or information;
(d) the supply of any assistance that is ancillary and subsidiary to, and is furnished as a means of enabling the application or enjoyment of, any such property or right as is mentioned in subparagraph (paragraph (a), any such equipment as is mentioned in subparagraph (paragraph (b) or any such knowledge or information as is mentioned in subparagraph (paragraph (c);
(e) the use of, or the right to use -
(i) motion picture films;
(ii) films or video tapes for use in connection with television; or
(iii) tapes for use in connection with radio broadcasting; or
(f) total or partial forbearance in respect of the use of a property or right referred to in this paragraph.
4.
Income derived from the alienation of property or rights mentioned in paragraph 3 may be taxed in the Contracting State in which the income arises, but the tax so charged shall not exceed 15 per cent of the gross amount of the income.
5.
The provisions of paragraphs 1, 2 and 4 shall not apply if the person beneficially entitled to the royalties or the income mentioned in paragraph 4, being a resident of one of the Contracting States, carries on business in the other Contracting State, in which the royalties or income arise, through a permanent establishment situated therein, or performs in that other State independent personal services from a fixed base situated therein, and the right or property in respect of which the royalties or income are paid is effectively connected with such permanent establishment or fixed base. In such a case, the provisions of Article 7 or Article 14, as the case may be, shall apply.
6.
Royalties and the income mentioned in paragraph 4 shall be deemed to arise in a Contracting State when the payer is that State itself or a political or administrative subdivision of that State or a local authority of that State or a person who is a resident of that State for the purposes of its tax. Where, however, the person paying the royalties or income, whether the person is a resident of one of the Contracting States or not has in a Contracting State or outside both Contracting States a permanent establishment or fixed base in connection with which the liability to pay the royalties or income was incurred, and such royalties or income are borne by the permanent establishment or fixed base, then such royalties or income shall be deemed to arise in the State in which the permanent establishment or fixed base is situated.
7.
Where, owing to a special relationship between the payer and the person beneficially entitled to the royalties or the income mentioned in paragraph 4, or between both of them and some other person, the amount of the royalties or income paid, having regard to what they are paid for, exceeds the amount which might have been expected to have been agreed upon by the payer and the person so entitled in the absence of such relationship, the provisions of this Article shall apply only to the lastmentioned amount. In that case, the excess part of the amount of the royalties or income paid shall remain taxable according to the law of each Contracting State, but subject to the other provisions of this Agreement.
8.
For the purposes of this Article " paid " includes credited and " payer " and " person paying " have the corresponding meanings.
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