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AGREEMENT BETWEEN THE GOVERNMENT OF THE
PEOPLE'S REPUBLIC OF
CHINA AND THE GOVERNMENT OF THE REPUBLIC OF SINGAPORE FOR THE
AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL
EVASION WITH RESPECT TO TAXES ON INCOME
The Government of the People's Republic of China and the Government of
the Republic of Singapore;
Desiring to conclude an Agreement for the avoidance of double taxation
and the prevention of fiscal evasion with respect to taxes on income;
Have agreed as follows:
Article 1 Personal Scope
This Agreement shall apply to persons who are residents of one or both
of the Contracting States.
Article 2 Taxes Covered
1. This Agreement shall apply to taxes on income imposed on
hehalf of a Contracting State or of its political subdivisions
or local authorities, irrespective of the manner in which they
are levied.
2. There shall be regarded as taxes on income all taxes
imposed on total income or on elements of income, including
taxes on gains from the alienation of movable or immovable
property and taxes on capital appreciation.
3. The existing taxes to which the Agreement shall apply
are:
(a) in the People's Republic of China:
(i) the individual income tax;
(ii) the income tax concerning joint ventures using Chinese
and foreign investment;
(iii) the income tax concerning foreign enterprises; and
(iv) the local income tax
(hereinafter referred to as "Chinese tax" ) ;
(b) in the Republic of Singapore:
the income tax (hereinafter referred to as "Singapore tax" )
.
4. This Agreement shall also apply to any identical or
substantially similar taxes which are imposed after the date
of signature of this Agreement in addition to, or in place of,
the existing taxes referred to in paragraph 3. The competent
authorities of the Contracting States shall notify each other
of any substantial changes which have been made in their
respective taxation laws within a reasonable period of time
after such changes.
Article 3
General Definitions
1. For the purposes of this Agreement, unless the context
otherwise requires:
(a) the term "China" means the People's Republic of China;
(b) the term "Singapore" means the Republic of Singapore;
(c) the terms "a Contracting State" and "the other
Contracting State" mean China or Singapore as the context
requires;
(d) the term "tax" means Chinese tax or Singapore tax, as
the context requires;
(e) the term "person" includes an individual, a company and
any other body of persons which is treated as an entity for
tax purposes;
(f) the term "company" means any body corporate or any
entity which is treated as a body corporate for tax purposes;
(g) the terms "enterprise of a Contracting State" and
"enterprise of the other Contracting State" mean,
respectively, an enterprise carried on by a resident of a
Contracting State and an enterprise carried on by a resident
of the other Contracting State;
(h) the term "national" means:
(i) all individuals possessing the nationality of a
Contracting State;
(ii) all legal persons, partnerships and associations
deriving their status as such from the laws in force in a
Contracting State;
(i) the term "international traffic" means any transport by
a ship or aircraft operated by an enterprise which is a
resident of a Contracting State, except when the ship or
aircraft is operated solely between places in the other
Contracting State;
(j) the term "competent authority" means, in the case of
China, the Ministry of Finance or its authorized
representative and, in the case of Singapore, the Minister for
Finance or his authorized representative.
2. As regards the application of this Agreement by a
Contracting State, any term not defined therein shall, unless
the context otherwise requires, have the meaning which it has
under the laws of that Contracting State concerning the taxes
to which this Agreement applies.
Article 4
Resident
1. For the purposes of this Agreement, the term "resident of
a Contracting State" means any person who is liable to tax as
a resident for tax purposes of that Contracting State by
reason of his domicile, residence, place of head office, place
of control and management or any other criterion of a similar
nature in accordance with the tax law of that Contracting
State.
2. Where by reason of the provisions of paragraph 1 an
individual is a resident of both Contracting States, then his
status shall be determined as follows:
(a) he shall be deemed to be a resident of the State in
which he has a permanent home available to him; if he has a
permanent home available to him in both States, he shall be
deemed to be a resident of the State with which his personal
and economic relations are closer (hereinafter referred to as
his "centre of vital interests" ) ;
(b) if the State in which he has his centre of vital
interests cannot be determined, or if he has not a permanent
home available to him in either State, he shall be deemed to
be a resident of the State in which he has an habitual abode;
(c) if he has an habitual abode in both States or in neither
of them, the competent authorities of the Contracting States
shall settle the question by mutual agreement.
3. Where by reason of the provisions of paragraph 1 a person
other than an individual is a resident of both Contracting
States, then the competent authorities of the Contracting
States shall determine his residential status by mutual
agreement.
Article 5
Permanent Establishment
1. For the purposes of this Agreement, the term "permanent
establishment" means a fixed place of business through which
the business of an enterprise is wholly or partly carried on.
2. The term "permanent establishment" includes especially:
(a) a place of management;
(b) a branch;
(c) an office;
(d) a factory;
(e) a workshop; and
(f) a mine, an oil or gas well, a quarry or any other place
of extraction of natural resources.
3. The term "permanent establishment" likewise encompasses:
(a) a building site, a construction, assembly or
installation project or supervisory activities in connection
therewith, but only where such site, project or activities
continue for a period of more than six months;
(b) the furnishing of services, including consultancy
services, by an enterprise of a Contracting State through
employees or other personnel in the other Contracting State,
provided that such activities continue for the same project or
a connected project for a period or periods aggregating more
than six months within any twelve-month period.
4. Notwithstanding the provisions of paragraphs 1 to 3, the
term "permanent establishment" shall be deemed not to include:
(a) the use of facilities solely for the purpose of storage,
display or delivery of goods or merchandise belonging to the
enterprise;
(b) the maintenance of a stock of goods or merchandise
belonging to the enterprise solely for the purpose of storage,
display or delivery;
(c) the maintenance of a stock of goods or merchandise
belonging to the enterprise solely for the purpose of
processing by another enterprise;
(d) the maintenance of a fixed place of business solely for
the purpose of purchasing goods or merchandise, or of
advertising, or of collecting information, for the enterprise;
(e) the maintenance of a fixed place of business solely for
the purpose of carrying on, for the enterprise, any other
activity of a preparatory or auxiliary character,
(f) the maintenance of a fixed place of business solely for
any combination of the activities mentioned in sub-paragraphs
(a) to (e), provided that the overall activity of the fixed
place of business resulting from this combination is of a
preparatory or auxiliary character.
5. Notwithstanding the provisions of paragraphs 1 and 2,
where a person-other than an agent of an independent status to
whom the provisions of paragraph 6 apply-is acting in a
Contracting State on behalf of an enterprise of the other
Contracting State, has and habitually exercises an authority
to conclude contracts in the name of the enterprise, that
enterprise shall be deemed to have a permanent establishment
in the first-mentioned Contracting State in respect of any
activities which that person undertakes for the enterprise,
unless his activities are limited to those mentioned in
paragraph 4 which, if exercised through a fixed place of
business, would not make this fixed place of business a
permanent establishment under the provisions of that
paragraph.
6. An enterprise of a Contracting State shall not be deemed
to have a permanent establishment in the other Contracting
State merely because it carries on business in that other
Contracting State through a broker, general commission agent
or any other agent of an independent status, provided that
such persons are acting in the ordinary course of their
business. However, when the activities of such an agent are
devoted wholly or almost wholly on behalf of that enterprise,
he will not be considered an agent of an independent status
within the meaning of this paragraph.
7. The fact that a company which is a resident of a
Contracting State controls or is controlled by a company which
is a resident of the other Contracting State, or which carries
on business in that other State (whether through a permanent
establishment or otherwise), shall not of itself constitute
either company a permanent establishment of the other.
Article 6
Income from Immovable Property
1. Income derived by a resident of a Contracting State from
immovable property situated in the other Contracting State may
be taxed in that other Contracting State.
2. The term "immovable property" shall have the meaning
which it has under the laws of the Contracting State in which
the property in question is situated. The term shall in any
case include property accessory to immovable poperty,
livestock and equipment used in agriculture and forestry,
rights to which the provisions of general law respecting
landed property apply, usufruct of immovable property and
rights to variable or fixed payments as consideration for the
working of, or the right to work, mineral deposits, sources
and other natural resources; ships and aircraft shall not be
regarded as immovable property.
3. The provisions of paragraph 1 shall apply to income
derived from the direct use, letting, or use in any other form
of immovable property.
4. The provisions of paragraphs 1 and 3 shall also apply to
income from immovable property of an enterprise and to income
from immovable property used for the performance of
independent personal services.
Article 7
Business Profits
1. The profits of an enterprise of a Contracting State shall
be taxable only in that Contracting State unless the
enterprise carries on business in the other Contracting State
through a permanent establishment situated therein. If the
enterprise carries on business as aforesaid, the profits of
the enterprise may be taxed in the other Contracting State but
only so much of them as is attributable to that permanent
establishment.
2. Subject to the provisions of paragraph 3, where an
enterprise of a Contracting State carries on business in the
other Contracting State through a permanent establishment
situated therein, there shall in each Contracting State be
attributed to that permanent establishment the profits which
it might be expected to make if it were a distinct and
separate enterprise engaged in the same or similar activities
under the same or similar conditions and dealing wholly
independently with the enterprise of which it is a permanent
establishment.
3. In determining the profits of a permanent establishment,
there shall be allowed as deductions expenses which are
incurred for the purposes of the permanent establishment,
including executive and general administrative expenses so
incurred, whether in the State in which the permanent
establishment is situated or elsewhere. However, no such
deduction shall be allowed in respect of amounts, if any, paid
(otherwise than towards reimbursement of actual expenses
including royalties, fees, interest or other similar payments)
by the permanent establishment to the head office of the
enterprise or any of its other offices, by way of royalties,
fees or other similar payments in return for the use of
patents or other rights, or by way of commission, for specific
services performed or for management, or, except in the case
of a banking enterprise, by way of interest on moneys lent to
the permanent establishment. Likewise, no account shall be
taken, in the determination of the profits of a permanent
establishment, for amounts charged (otherwise than towards
reimbursement of actual expenses including royalties, fees,
interest or other similar payments) by the permanent
establishment to the head office of the enterprise or any of
its other offices, by way of royalties, fees or other similar
payments in return for the use of patents or other rights, or
by way of commission for specific services performed or for
management, or, except in the case of a banking enterprise by
way of interest on moneys lent to the head office of the
enterprise or any of its other offices.
4. Insofar as it has been customary in a Contracting State
to determine the profits to be attributed to a permanent
establishment on the basis of an apportionment of the total
profits of the enterprise to its various parts, nothing in
paragraph 2 shall preclude that Contracting State from
determining the profits to be taxed by such an apportionment
as may be customary. The method of apportionment adopted
shall, however, be such that the result shall be in accordance
with the principles contained in this Article.
5. No profits shall be attributed to a permanent
establishment by reason of the mere purchase by that permanent
establishment of goods or merchandise for the enterprise.
6. Where profits include items of income which are dealt
with separately in other Articles of this Agreement, then the
provisions of those Articles shall not be affected by the
provisions of this Article.
Article 8
Shipping and Air Transport
1. Income from the operation of ship or aircraft in
international traffic carried on by an enterprise which is a
resident of a Contracting State shall be exempt from tax in
the other Contracting State, unless the ship or aircraft is
operated solely between places within the other Contracting
State.
2. The provisions of paragraph 1 shall also apply to income
derived from the participation in a pool, a joint business or
an international operating agency.
3. For the purposes of paragraphs 1 and 2 of this Article,
income derived by an enterprise which is a resident of a
Contracting State from the operation of ship or aircraft from
the other Contracting State shall mean income from the
carriage of passengers, mail, livestock or goods loaded into a
ship or aircraft in that other Contracting State.
Article 9
Associated Enterprises
Where
(a) an enterprise of a Contracting State participates
directly or indirectly in the management, control or capital
of an enterprise of the other Contracting State, or
(b) the same persons participate directly or indirectly in
the management, control or capital of an enterprise of a
Contracting State and an enterprise of the other Contracting
State,
and in either case conditions are made or imposed between
the two enterprises in their commercial or financial relations
which differ from those which would be made between
independent enterprises, then any profits which would, but for
those conditions, have accrued to one of the enterprises, but,
by reason of those conditions, have not so accrued, may be
included in the profits of that enterprise and taxed
accordingly.
Article 10
Dividends
1. Dividends paid by a company which is a resident of a
Contracting State to a resident of the other Contracting State
may be taxed in that other Contracting State.
2.
(a) However, dividends paid by a company which is a resident
of China to a resident of Singapore may also be taxed in
China, and according to the laws of China, but if the
recipient is the beneficial owner of the dividends the tax so
charged shall not exceed 12 per cent of the gross amount of
the dividends. Where, however, the recipient is a company or a
partnership which holds directly at least 25 per cent of the
shares of the company paying the dividends, the tax so charged
shall not exceed 7 per cent of the gross amount of the
dividends.
(b) Dividends paid by a company which is a resident of
Singapore to a resident of China shall, if the recipient is
the beneficial owner of the dividends, be exempt from any tax
in Singapore which is chargeable on dividends in addition to
the tax chargeable in respect of the profits or income of the
company-
(i) provided that nothing in this paragraph shall affect the
provisions of Singapore law under which the tax in respect of
a dividend paid by a company which is a resident of Singapore
from which Singapore tax has been, or has been deemed to be,
deducted may be adjusted by reference to the rate of tax
appropriate to the Singapore year of assessment immediately
following that in which the dividend was paid;
(ii) provided further that if Singapore, subsequent to the
signing of this Agreement, imposes a tax on dividends paid by
a company which is a resident of Singapore which is in
addition to the tax chargeable in respect of the profits or
income of the company, such tax may be charged but the rate of
tax so charged shall, if the recipient is the beneficial owner
of the dividends, not exceed 12 per cent of the gross amount
of the dividends, and where the recipient is a company or a
partnership which holds directly at least 25 per cent of the
shares of the company paying the dividends, the tax so charged
shall not exceed 7 per cent of the gross amount of the
dividends.
(c) The competent authorities of the Contracting States
shall by mutual agreement settle the mode of application of
these limitations.
(d) This paragraph shall not affect the taxation of the
company in respect of the profits out of which the dividends
are paid.
3. The term "dividends" as used in this Article means income
from shares or other rights, not being debt-claims,
participating in profits, as well as income from other
corporate rights which is subjected to the same taxation
treatment as income from shares by the laws of the Contracting
State of which the company making the distribution is a
resident.
4. The provisions of paragraphs l and 2 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 situated
therein, or performs in that other Contracting State
independent personal services from a fixed base situated
therein, and the holding in respect of which the dividends are
paid is effectively connected with such permanent
establishment or fixed base. In such case the provisions of
Article 7 or Article 14, as the case may be, shall apply.
5. Where a company which is a resident of a Contracting
State derives profits or income from the other Contracting
State, that other Contracting State, may not impose any tax on
the dividends paid by the company, except insofar as such
dividends are paid to a resident of that other Contracting
State or insofar as the holding in respect of which the
dividends are paid is effectively connected with a permanent
establishment or a fixed base situated in that other
Contracting State, nor subject the company's undistributed
profits to a tax on the company's undistributed profits, even
if the dividends paid or the undistributed profits consist
wholly or partly of profits or income arising in that other
Contracting State.
Article 11
Interest
1. Interest arising in a Contracting State and paid to a
resident of the other Contracting State may be taxed in that
other Contracting State.
2. However, such interest may also be taxed in the
Contracting State in which it arises, and according to the
laws of that Contracting State, but if the recipient is the
beneficial owner of the interest the tax so charged shall not
exceed:
(a) 7 per cent of the gross amount of the interest if it is
received by any bank or financial institution;
(b) 10 per cent of the gross amount of the interest in all
other cases.
The competent authorities of the Contracting States shall by
mutual agreement settle the mode of application of these
limitations.
3. Notwithstanding the provisions of paragraph 2, interest
arising in a Contracting State and paid to the Government of
the other Contracting State shall be exempt from tax in the
first-mentioned Contracting State.
4. For the purposes of paragraph 3, the term "Government" -
(a) in the case of Singapore means the Government of
Singapore and shall include:
(i) the Monetary Authority of Singapore;
(ii) the Government of Singapore Investment Corporation Pte
Ltd;
(iii) the head office of the Development Bank of Singapore;
(iv) any institution wholly or mainly owned by the
Government of Singapore, as may be agreed from time to time
between the competent authorities of the Contracting States;
(b) in the case of China means the Government of China and
shall include:
(i) the People's Bank of China;
(ii) the China International Trust and Investment
Corporation;
(iii) the head office of the Bank of China;
(iv) any institution wholly or mainly owned by the
Government of China, as may be agreed from time to time
between the competent authorities of the Contracting States.
5. The term "interest" as used in this Article means income
from debt-claims of every kind, whether or not secured by
mortgage and whether or not carrying a right to participate in
the debtor's profits, and in particular, income from
Government securities and income from bonds or debentures,
including premiums and prizes attaching to such securities,
bonds or debentures.
6. The provisions of paragraphs 1, 2 and 3 shall not apply
if the beneficial owner of the interest, being a resident of a
Contracting State, carries on business in the other
Contracting State in which the interest arises, through a
permanent establishment situated therein, or performs in that
other Contracting State independent personal services from a
fixed base situated therein, and the debt-claim in respect of
which the interest is paid is effectively connected with such
permanent establishment or fixed base. In such case the
provisions of Article 7 or Article 14, as the case may be,
shall apply.
7. Interest shall be deemed to arise in a Contracting State
when the payer is the Government of that Contracting State, a
statutory body, a local authority or a resident of that
Contracting State. Where, however, the person paying the
interest, whether he is a resident of a Contracting State or
not, has in a Contracting State a permanent establishment or a
fixed base in connection with which the indebtedness on which
the interest is paid was incurred, and such interest is borne
by such permanent establishment or fixed base, then such
interest shall be deemed to arise in the Contracting State in
which the permanent establishment or fixed base is situated.
8. Where, by reason of a special relationship between the
payer and the beneficial owner or between both of them and
some other person, the amount of the interest, having regard
to the debt-claim for which it is paid, exceeds the amount
which would have been agreed upon by the payer and the
beneficial owner in the absence of such relationship, the
provisions of this Article shall apply only to the
last-mentioned amount. In such case, the excess part of the
payment shall remain taxable according to the laws of each
Contracting State, due regard being had to the other
provisions of this Agreement.
Article 12
Royalties
1. Royalties arising in a Contracting State and paid to a
resident of the other Contracting State may be taxed in that
other Contracting State.
2. However, such royalties may also be taxed in the
Contracting State in which they arise, and according to the
laws of that Contracting State, but if the recipient is the
beneficial owner of the royalties the tax so charged shall not
exceed 10 per cent of the gross amount of the royalties. The
competent authorities of the Contracting States shall by
mutual agreement settle the mode of application of this
limitation.
3. The term "royalties" as used in this Article means
payments of any kind received as a consideration for the use
of, or the right to use, any copyright of literary, artistic
or scientific work including cinematograph films and films or
tapes for radio or television broadcasting, any patent,
know-how, trade mark, design or model, plan, secret formula or
process, or for the use of, or the right to use, industrial,
commercial or scientific equipment, or for information
concerning industrial, commercial or scientific experience.
4. The provisions of paragraphs 1 and 2 shall not apply if
the beneficial owner of the royalties, being a resident of a
Contracting State, carries on business in the other
Contracting State in which the royalties arise, through a
permanent establishment situated therein, or performs in that
other Contracting State independent personal services from a
fixed base situated therein, and the right or property in
respect of which the royalties are paid is effectively
connected with such permanent establishment or fixed base. In
such case the provisions of Article 7 or Article 14, as the
case may be, shall apply.
5. Royalties shall be deemed to arise in a Contracting State
when the payer is the Government of that Contracting State, a
statutory body, a local authority or a resident of that
Contracting State. Where, however, the person paying the
royalties, whether he is a resident of a Contracting State or
not, has in a Contracting State a permanent establishment or a
fixed base in connection with which the liability to pay the
royalties was incurred, and such royalties are borne by such
permanent establishment or fixed base, then such royalties
shall be deemed to arise in the Contracting State in which the
permanent establishment or fixed base is situated.
6. Where, by reason of a special relationship between the
payer and the beneficial owner or between both of them and
some other person, the amount of the royalties, having regard
to the use, right or information for which they are paid,
exceeds the amount which would have been agreed upon by the
payer and the beneficial owner in the absence of such
relationship, the provisions of this Article shall apply only
to the last-mentioned amount. In such case, the excess part of
the payments shall remain taxable according to the laws of
each Contracting State, due regard being had to the other
provisions of this Agreement.
Article 13
Capital Gains
1. Gains derived by a resident of a Contracting State from
the alienation of immovable property referred to in Article 6
and situated in the other Contracting State may be taxed in
that other Contracting State.
2. Gains from the alienation of movable property forming
part of the business property of a permanent establishment
which an enterprise of a Contracting State has in the other
Contracting State or of movable property pertaining to a fixed
base available to a resident of a Contracting State in the
other Contracting State for the purpose of performing
independent personal services, including such gains from the
alienation of such a permanent establishment (alone or
together with the whole enterprise) or of such a fixed base,
may be taxed in that other Contracting State.
3. Gains from the alienation of ships or aircraft operated
in international traffic and movable property, pertaining to
the operation of such ships or aircraft shall be taxable only
in the Contracting State in which the enterprise is a
resident.
4. Gains from the alienation of shares of the capital stock
of a company the property of which consists directly or
indirectly principally of immovable property situated in a
Contracting State may be taxed in that Contracting State.
5. Gains from the alienation of shares other than those
mentioned in paragraph 4 representing a participation of 25
per cent in a company which is a resident of a Contracting
State may be taxed in that Contracting State.
6. Gains derived by a resident of a Contracting State from
the alienation of any property other than that referred to in
paragraphs 1 to 5 and arising in the other Contracting State
may be taxed in that other Contracting State.
Article 14
Independent Personal Services
1. Income derived by an individual who is a resident of a
Contracting State in respect of professional services or other
activities of an independent character shall be taxable only
in that Contracting State, unless he has a fixed base
regularly available to him in the other Contracting State for
the purpose of performing his activities or he is present in
that other Contracting State for a period or periods exceeding
in the aggregate 183 days in the calendar year concerned. If
he has such a fixed base or remains in that other Contracting
State for the aforesaid period or periods, the income may be
taxed in that other Contracting State, but only so much of it
as is attributable to that fixed base or is derived in that
other Contracting State during the aforesaid period or
periods.
2. The term "professional services" includes especially
independent scientific, literary, artistic, educational or
teaching activities as well as the independent activities of
physicians, lawyers, engineers, architects, dentists and
accountants.
Article 15
Dependent Personal Services
1. Subject to the provisions of Articles 16, 18, 19, 20 and
21, salaries, wages and other similar remuneration derived by
a resident of a Contracting State in respect of an employment
shall be taxable only in that Contracting State unless the
employment is exercised in the other Contracting State. If the
employment is so exercised, such remuneration as is derived
therefrom may be taxed in that other Contracting State.
2. Notwithstanding the provisions of paragraph 1,
remuneration derived by a resident of a Contracting State in
respect of an employment exercised in the other Contracting
State shall be taxable only in the first-mentioned State if:
(a) the recipient is present in the other Contracting State
for a period or periods not exceeding in the aggregate 183
days in the calendar year concerned; and
(b) the remuneration is paid by, or on behalf of, an
employer who is not a resident of the other Contracting State;
and
(c) the remuneration is not borne by a permanent
establishment or a fixed base which the employer has in the
other Contracting State.
3. Notwithstanding the preceding provisions of this Article,
remuneration derived in respect of an employment exercised
aboard a ship or aircraft operated in international traffic,
shall be taxable only in the Contracting State in which the
enterprise is a resident.
Article 16
Directors' Fees
Directors' fees and other similar payments derived by a
resident of a Contracting State in his capacity as a member of
the board of directors of a company which is a resident of the
other Contracting State may be taxed in that other Contracting
State.
Article 17
Artistes and Athletes
1. Notwithstanding the provisions of Articles 14 and 15,
income derived by a resident of a Contracting State as an
entertainer, such as a theatre, motion picture, radio or
television artiste, or a musician, or as an athlete, from his
personal activities as such exercised in the other Contracting
State, may be taxed in that other Contracting State.
2. Where income in respect of personal activities exercised
by an entertainer or an athlete in his capacity as such
accrues not to the entertainer or athlete himself but to
another person, that income may, notwithstanding the
provisions of Articles 7, 14 and 15, be taxed in the
Contracting State in which the activities of the entertainer
or athlete are exercised.
3. Notwithstanding the provisions of paragraphs 1 and 2,
income derived by entertainers or athletes who are residents
of a Contracting State from the activities exercised in the
other Contracting State shall be exempt from tax in that other
Contracting State if such activities are supported, wholly or
substantially, from the public funds of the Government of
either Contracting State or a statutory body or a local
authority thereof.
Article 18
Pensions
1. Subject to the provisions of paragraph 2 of Article 19,
pensions and other similar remuneration paid to a resident of
a Contracting State in consideration of past employment shall
be taxable only in that Contracting State.
2. Notwithstanding the provisions of paragraph 1, pensions
paid and other similar payments made by the Government of a
Contracting State or a statutory body or a local authority
thereof under a public welfare scheme of the social security
system of that Contracting State shall be taxable only in that
Contracting State.
Article 19
Government Service
1.
(a) Remuneration, other than pension, paid by the Government
of a Contracting State or a statutory body or a local
authority thereof to an individual in respect of services
rendered to the Government of that Contracting State or a
statutory body or a local authority thereof, in the discharge
of functions of a governmental nature, shall be taxable only
in that Contracting State.
(b) However, such remuneration shall be taxable only in the
other Contracting State if the services are rendered in that
other Contracting State and the individual is a resident of
that other Contracting State who:
(i) is a national of that other Contracting State; or
(ii) did not become a resident of that other Contracting
State solely for the purpose of rendering the services.
2.
(a) Any pension paid by, or out of funds created by, the
Government of a Contracting State or a statutory body or a
local authority thereof to an individual in respect of
services rendered to the Government of that Contracting State
or a statutory body or a local authority thereof shall be
taxable only in that Contracting State.
(b) However, such pension may be taxable in the other
Contracting State if the individual is a resident of, and a
national of, that other Contracting State.
3. The provisions of Articles l5, 16, 17 and 18 shall apply
to remuneration and pensions in respect of services rendered
in connection with a business carried on by the Government of
a Contracting State or a statutory body or a local authority
thereof.
Article 20
Teachers and Researchers
1. An individual who is a resident of a Contracting State
immediately before making a visit to the other Contracting
State, and who, at the invitation of any university, college,
school or other similar educational institution, which is
approved by the competent authority in that other Contracting
State, visits that other Contracting State for a period not
exceeding three years solely for the purpose of teaching or
research or both at such educational institution shall be
exempt from tax in that other Contracting State on his
remuneration for such teaching or research.
2. Where his visits, under one or more contracts with the
educational institutions of the other Contracting State exceed
three years, the exemption under paragraph 1 shall apply to
his remuneration for such teaching or research for the first
three years.
3. This Article shall not apply to income from research if
such research is undertaken primarily for the private benefit
of a specific person or persons.
Article 21
Students and Trainees
An individual who is a resident of a Contracting State
immediately before making a visit to the other Contracting
State and is temporarily present in the other Contracting
State solely:
(a) as a student at a recognised university, college, school
or other similar recognised educational institution in that
other Contracting State;
(b) as a business or technical apprentice; or
(c) as a recipient of a grant, allowance or award for the
primary purpose of study, research or training from the
Government of either Contracting State or from a scientific,
educational, literary or charitable organisation or under a
technical assistance programme entered into by the Government
of either Contracting State,
shall be exempt from tax in that other Contracting State on:
(a) all remittances from abroad for the purposes of his
maintenance, education, study, research or training;
(b) the amount of such grant, allowance or award; and
(c) an amount up to US$ 2000 or the equivalent in Singapore
dollar or the equivalent in Chinese RMB per calendar year of
any remuneration in respect of services in that other
Contracting State provided the services are performed in
connection with his study, research or training or are
necessary for the purposes of his maintenance.
Article 22
Other Income
1. Items of income of a resident of a Contracting State,
wherever arising, not dealt with in the foregoing Articles of
this Agreement shall be taxable only in that Contracting
State.
2. The provisions of paragraph 1 shall not apply to income,
other than income from immovable property as defined in
paragraph 2 of Article 6, if the recipient of such income,
being a resident of a Contracting State, carries on business
in the other Contracting State through a permanent
establishment situated therein, or performs in that other
Contracting State independent personal services from a fixed
base situated therein, and the right or property in respect of
which the income is paid is effectively connected with such
permanent establishment or fixed base. In such case the
provisions of Article 7 or Article 14, as the case may be,
shall apply.
3. Notwithstanding the provisions of paragraphs 1 and 2,
items of income of a resident of a Contracting State not dealt
with in the foregoing Articles of this Agreement and arising
in the other Contracting State may be taxed in that other
Contracting State.
Article 23
Limitation of Relief
1. Where this Agreement provides (with or without other
conditions) that income from sources in China shall be exempt
from tax, or taxed at a reduced rate in China and under the
laws in force in Singapore the said income is subject to tax
byreference to the amount thereof which is remitted to or
received in Singapore and not by reference to the full amount
thereof, then the exemption or reduction of tax to be allowed
under this Agreement in China shall apply only to so much of
the income as is remitted to or received in Singapore.
2. However, this limitation does not apply to income derived
by the Government of Singapore or any person approved by the
competent authority of Singapore for the purpose of this
paragraph.
Article 24
Methods for the Elimination of Double Taxation
1. In Singapore, double taxation shall be eliminated as
follows:
Subject to the laws of Singapore regarding the allowance as
a credit against Singapore tax of tax payable in any country
other than Singapore, Chinese tax payable in respect of income
derived from China shall be allowed as a credit against
Singapore tax payable in respect of that income. Where such
income is a dividend paid by a company which is a resident of
China to a company which is a resident of Singapore and which
owns not less than 10 per cent of the shares of the company
paying the dividend, the credit shall take into account
Chinese tax payable by that company in respect of its income
out of which the dividend is paid. The credit shall not,
however, exceed that part of the Singapore tax, as computed
before the credit is given, which is appropriate to such item
of income.
2. In China, double taxation shall be eliminated as follows:
(a) Where a resident of China derives income from Singapore,
the amount of tax on that income payable in Singapore in
accordance with the provisions of this Agreement, may be
credited against the Chinese tax imposed on that resident. The
amount of credit shall not, however, exceed the amount of the
Chinese tax on that income computed in accordance with the
taxation laws and regulations of China.
(b) Where the income derived from Singapore is a dividend
paid by a company which is a resident of Singapore to a
company which is a resident of China and which owns not less
than 10 per cent of the shares of the company paying the
dividend, the credit shall take into account the tax paid to
Singapore by the company paying the dividend in respect of its
income.
3. For the purposes of the credit referred to in paragraph 1
of this Article, the amount of Chinese tax imposed on items of
income under Articles 10, 11 and 12 shall be deemed to have
been paid at:
(a)
(i) 10 per cent of the gross amount of dividends paid by a
joint venture with Chinese and foreign investment;
(ii) 20 per cent of the gross amount of other dividends;
(b) 20 per cent of the gross amount of interest;
(c) 20 per cent of the gross amount of royalties.
4. For the purposes of the credit referred to in paragraph 1
of this Article, Chinese tax payable shall be deemed to
include the amount of Chinese tax which would have been paid
if the Chinese tax had not been exempted, reduced or refunded
in accordance with:
(a) the provisions of Articles 5 and 6 of the Income Tax Law
of the People's Republic of China Concerning Joint Ventures
with Chinese and Foreign Investment and the provisions of
Article 3 of the Detailed Rules and Regulations for the
Implementation of the Income Tax Law of the People's Republic
of China Concerning Joint Ventures with Chinese and Foreign
Investment;
(b) the provisions of Articles 4 and 5 of the Income Tax Law
of the People's Republic of China Concerning Foreign
Enterprises;
(c) the provisions concerning reduction in or exemption from
income tax in paragraphs 1, 2 and 3 of Articles 1 and 2 and
paragraphs 1 and 2 of Article 3 of the Interim Provisions of
the State Council of China on Reduction in or Exemption from
Enterprise Income Tax and the Industrial and Commercial
Consolidated Tax for Special Economic Zones and Fourteen
Coastal Cities;
(d) the provisions of any reduction in, exemption from or
refund of tax designed to promote economic development in
China which may be introduced under the laws of China after
the date of signature of this Agreement, and which may be
agreed upon between the competent authorities of the
Contracting States.
Article 25
Non-Discrimination
1. The nationals of a Contracting State shall not be
subjected in the other Contracting State to any taxation or
any requirement connected therewith which is other or more
burdensome than the taxation and connected requirements to
which nationals of that other Contracting State in the same
circumstances are or may be subjected.
2. The taxation on a permanent establishment which an
enterprise of a Contracting State has in the other Contracting
State shall not be less favourably levied in that other
Contracting State than the taxation levied on enterprises of
that other Contracting State carrying on the same activities.
3. Nothing in this Article shall be construed as obliging a
Contracting State to grant to-
(a) residents of the other Contracting State any personal
allowances, reliefs and reductions for tax purposes which it
grants to its own residents, or
(b) nationals of the other Contracting State those personal
allowances, reliefs and reductions for tax purposes which it
grants to its own nationals who are not residents in that
Contracting State or to such other persons as may be specified
in the taxation laws of that Contracting State.
4. Enterprises of a Contracting State, the capital of which
is wholly or partly owned or controlled, directly or
indirectly, by one or more residents of the other Contracting
State, shall not be subjected in the first-mentioned State to
any taxation or any requirement connected therewith which is
other or more burdensome than the taxation and connected
requirements to which other similar enterprises of the
first-mentioned State are or may be subjected.
5. Where a Contracting State grants tax incentives to its
nationals designed to promote economic development in
accordance with its national policy and criteria, it shall not
be construed as discrimination under this Article.
6. In this Article, the term "taxation" means taxes which
are the subject of this Agreement.
Article 26
Mutual Agreement Procedure
1. Where a person considers that the actions of one or both
of the Contracting States result or will result for him in
taxation not in accordance with the provisions of this
Agreement, he may, irrespective of the remedies provided by
the domestic laws of those Contracting States, present his
case to the competent authority of the Contracting State of
which he is a resident or, if his case comes under paragraph 1
of Article 25, to that of the Contracting State of which he is
a national. The case must be presented within three years from
the first notification of the action resulting in taxation not
in accordance with the provisions of the Agreement.
2. The competent authority shall endeavour, if the objection
appears to it to be justified and if it is not itself able to
arrive at a satisfactory solution, to resolve the case by
mutual agreement with the competent authority of the other
Contracting State, with a view to the avoidance of taxation
which is not in accordance with the provisions of this
Agreement. Any agreement reached shall be implemented
notwithstanding any time limits in the domestic laws of the
Contracting States.
3. The competent authorities of the Contracting States shall
endeavour to resolve by mutual agreement any difficulties or
doubts arising as to the interpretation or application of the
Agreement. They may also consult together for the elimination
of double taxation in cases not provided for in this
Agreement.
4. The competent authorities of the Contracting States may
communicate with each other directly for the purposes of
reaching an agreement in the sense of paragraphs 2 and 3. When
it seems advisable for reaching agreement, representatives of
the competent authorities of the Contracting States may meet
together for an oral exchange of opinions.
Article 27
Exchange of Information
1. The competent authorities of the Contracting States shall
exchange such information as is necessary for carrying out the
provisions of this Agreement, in particular for the prevention
of evasion of taxes covered by this Agreement. Any information
received by a Contracting State shall be treated as secret and
shall be disclosed only to persons or authorities (including
courts and administrative bodies) involved in the assessment
or collection of, the enforcement or prosecution in respect
of, or the determination of appeals in relation to, the taxes
covered by the Agreement. Such persons or authorities shall
use the information only for such purposes. They may disclose
the information in public court proceedings or in judicial
decisions.
2. In no case shall the provisions of paragraph 1 be
construed so as to impose on a Contracting State the
obligation:
(a) to carry out administrative measures at variance with
the laws and the administrative practice of that or of the
other Contracting State;
(b) to supply information which is not obtainable under the
laws or in the normal course of the administration of that or
of the other Contracting State;
(c) to supply information which could disclose any trade,
business, industrial, commercial or professional secret or
trade process, or information, the disclosure of which would
be contrary to public policy.
Article 28
Diplomatic Agents and Consular Officers
Nothing in this Agreement shall affect the fiscal privileges
of diplomatic agents or consular officers under the general
rules of international law or under the provisions of special
agreements.
Article 29
Entry into Force
This Agreement shall enter into force on the thirtieth day
after the date on which diplomatic notes indicating the
completion of internal legal procedures necessary in each
country for the entry into force of this Agreement have been
exchanged. This Agreement shall have effect as respects income
derived on or after the first day of January 1986.
Article 30
Termination
This Agreement shall continue in effect indefinitely but
either of the Contracting States may, on or before the
thirtieth day of June in any calendar year beginning after the
expiration of a period of five years from the date of its
entry into force, give to the other Contracting State, through
the diplomatic channel, written notice of termination. In such
event this Agreement shall cease to have effect for income
derived on the first day of January in the year next following
the year in which the notice of termination is given and
thereafter.
IN WITNESS WHEREOF the undersigned, being duly authorised
thereto, have signed this Agreement.
DONE in duplicate at Singapore this 18th day of April, 1986,
in the English and Chinese languages, both texts being equally
authoritative.
For the Government For
the Government
of the People's
of the Republic
Republic of China of
Singapore
PROTOCOL
At the signing of the Agreement between the Government of
the People's Republic of China and the Government of the
Republic of Singapore for the Avoidance of Double Taxation and
the Prevention of Fiscal Evasion with respect to Taxes on
Income (hereinafter referred to as "the Agreement" ) both
sides have agreed upon the following provisions which form an
integral part of the Agreement.
In connection with Article 8, "Shipping and Air Transport" :
(a) the exemption shall also include-
(i) in China, the industrial and commercial consolidated tax
and its surtax;
(ii) in Singapore, any tax similar to the industrial and
commercial consolidated tax and its surtax in China which may
be imposed in Singapore after the signing of the Agreement;
(b) the exemption under the provisions of Article 8 and
sub-paragraph (a) of this paragraph in respect of income
derived from shipping carried on by an enterprise which is a
resident of a Contracting State shall be effective only from
the date a Shipping Agreement between China and Singapore
enters into force.
IN WITNESS WHEREOF the undersigned, being duly authorised
thereto, have signed this Protocol.
DONE in duplicate at Singapore this 18th day of April, 1986,
in the English and Chinese languages, both texts being equally
authoritative.
For the Government For
the Government
of the People's
of the Republic
Republic of China
of Singapore
EXCHANGE OF NOTES
HE Mr. Xiang Huaicheng
Vice Commissioner
of the State Administration of Taxation
of the People's Republic of China
Excellency,
I have the honour to acknowledge receipt of Your
Excellency's Note of today's date, which reads as follows:
"I have the honour to refer to the Agreement between the
Government of the People's Republic of China and the
Government of the Republic of Singapore for the Avoidance of
Double Taxation and the Prevention of Fiscal Evasion with
respect to Taxes on Income signed at Singapore on 18 April
1986 (hereinafter referred to as "the Agreement" ) and to
propose on behalf of the Government of the People's Republic
of China the following arrangement:
1. Sub-paragraph (a) of paragraph 3 of Article 2 of the
Agreement shall be deleted and replaced by the following:
(a) in the People's Republic of China:
(i) the individual income tax;
(ii) the income tax for enterprises with foreign investment
and foreign enterprises; and
(iii) the local income tax.
(hereinafter referred to as "Chinese Tax" )
2. Sub-paragraphs (a) and (b) of paragraph 4 of Article 24
of the Agreement shall be deleted and replaced by the
following:
(a) the provisions of Articles 7, 8, 9 and 10 of the Income
Tax Law of the People's Republic of China for Enterprises with
Foreign Investment and Foreign Enterprises and the provisions
of Article 73, 75 and 81 of the Detailed Rules and Regulations
for the Implementation of the Income Tax Law of the People's
Republic of China for Enterprises with Foreign Investment and
Foreign Enterprises.
3. Sub-paragraphs (c) and (d) of paragraph 4 of Article 24
of the Agreement shall be read as (b) and (c) respectively.
I have the honour to propose that this Note and Your
Excellency's Note in reply confirming the acceptance by the
Government of the Republic of Singapore of the above proposal
shall be regarded as constituting an agreement between the two
Governments under paragraph 4 of Article 2 and sub-paragraph
(d) of paragraph 4 of Article 24 of the Agreement, which will
enter into force on the date of Your Excellency's reply and
shall have effect in respect of income derived on or after
July 1, 1991.
Done in the Chinese and English languages, both texts being
equally authentic.
I avail myself of this opportunity to extend to Your
Excellency the assurances of my highest consideration. "
I have further the honour to confirm the acceptance by the
Government of the Republic of Singapore of the above proposal
and agree that Your Excellency's Note and this Note shall be
regarded as constituting an agreement between the two
Governments which will enter into force on the date of this
reply.
Done in the English and Chinese languages, both texts being
equally authentic.
I avail myself of this opportunity to extend to Your
Excellency the assurances of my highest consideration.
Cheng Tong Fatt
Ambassador Extraordinary and Plenipotentiary
of the Republic of Singapore to the People's Republic of China |
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