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SUBSIDIARY LEGISLATION 123.64
DOUBLE TAXATION RELIEF ON TAXES ON 
INCOME WITH THE REPUBLIC OF TUNISIA 
ORDER
6th August, 2002
LEGAL NOTICE 225 of 2002.
Title.
Taxes on Income with the Republic of Tunisia Order.
Arrangements to 
have effect.
2. It is hereby declared -
( a ) that the arrangements specified in the Convention set
out in the Schedule to this order have been made with
the Republic of Tunisia with a view to affording relief
from double taxation in relation to the following taxes
imposed by the laws of the Republic of Tunisia:
- the income tax; and
- the corporation tax;
( b ) that it is expedient that those arrangements should
have effect;
( c ) that the Convention has entered into force on the 31st
December, 2001.
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SCHEDULE
CONVENTION BETWEEN MALTA
AND THE REPUBLIC OF TUNISIA
FOR THE AVOIDANCE OF DOUBLE TAXATION
AND THE PREVENTION OF FISCAL EVASION
WITH RESPECT TO TAXES ON INCOME
The Government of Malta and the Government of the Republic of Tunisia,
desiring to conclude a Convention for the avoidance of double taxation and the
prevention of fiscal evasion with respect to taxes on income, have agreed as follows:
CHAPTER I
SCOPE OF THE CONVENTION
Article 1
PERSONAL SCOPE
This Convention shall apply to persons who are residents of one or both of
the Contracting States.
Article 2
TAXES COVERED
1. This Convention shall apply to taxes on income imposed on behalf of a
Contracting State or its political subdivisions or of its 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, taxes on the total amounts of wages or salaries, as
well as taxes on capital appreciation.
3. The existing taxes to which the Convention shall apply are:
( a ) in the case of Tunisia:
- the income tax;
- the corporation tax;
(hereinafter referred to as "Tunisian tax");
( b ) in the case of Malta:
the income tax;
(hereinafter referred to as "Malta tax").
4. The Convention shall apply also to any identical or substantially similar
taxes which are imposed after the date of signature of the Convention in addition to,
or in place of, the existing taxes. The competent authorities of the Contracting States
shall notify each other of any substantial changes which have been made in their
respective taxation laws.
5. Notwithstanding the other provisions of this Article this Convention shall
not apply to tax paid or payable in Malta in accordance with the provisions of
subarticle (13) of article 56 of the Income Tax Act (Cap. 123), concerning the
chargeable income of any person engaged in the production of petroleum produced
in Malta, or any substantially similar provision which is imposed after the date of
signature of this Convention.
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CHAPTER II
DEFINITIONS
Article 3
GENERAL DEFINITIONS
1. For the purposes of this Convention:
( a ) the terms "a Contracting State" and "the other Contracting State" mean
Tunisia or Malta, as the context requires;
( b ) the term "Tunisia" means the Republic of Tunisia;
( c ) the term "Malta" means the Republic of Malta;
( d ) the term "person" includes an individual, a company and any other body
of persons;
( e ) the term "company" means any body corporate or any entity which is
treated as a body corporate for tax purposes;
( f ) 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;
( g ) the term "national" means:
- any individual possessing the nationality of a Contracting State;
- any legal person, partnership, association and any other entity
deriving its status as such from the laws in force in a Contracting
State;
( h ) the term "international traffic" means any transport by a ship, aircraft or
road vehicle operated by an enterprise which has its place of effective
management in a Contracting State, except when the ship, aircraft or
road vehicle is operated solely between places in the other Contracting
State; and
( i ) the term "competent authority" means :
- in the case of Tunisia, the Minister of Finance or his authorised
representative;
- in the case of Malta, the Minister responsible for finance or his
authorised representative.
2. As regards the application of the Convention by a Contracting State, any
term not defined therein shall, unless the context otherwise requires, have the
meaning which it has under the law of that State concerning the taxes to which the
Convention applies.
Article 4
RESIDENT
1. For the purposes of this Convention, the term "resident of a Contracting
State" means any person who, under the laws of that State, is liable to tax therein by
reason of his domicile, residence, place of incorporation or any other criterion of a
similar nature.
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 solely of the Contracting State in
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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
solely of the Contracting State with which his personal and economic
relations are closer (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, he shall
be deemed to be a resident solely of the Contracting State of which he is
a national;
( d ) if he is a national of both States or of 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 it shall be deemed to be a
resident only of the State in which its place of effective management is situated.
Article 5
PERMANENT ESTABLISHMENT
1. For the purposes of this Convention, 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;
( f ) a mine, an oil or gas well, a quarry or any other place of extraction of
natural resources including an offshore drilling site;
( g ) a building site or construction or assembly project or supervisory
activities where such site, project or activity continues for more than six
months.
3. Notwithstanding the preceding provisions of this Article, the term
"permanent establishment" shall be deemed not to include:
( a ) the use of facilities solely for the purpose of storage or display 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
publicity;
( e ) the maintenance of a fixed place of business solely for the purpose of
exercising any other activities which have a preparatory or auxiliary
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character for the enterprise;
( f ) the maintenance of a fixed place of business solely for any combination
of 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.
4. An enterprise of a Contracting State shall be deemed to have a permanent
establishment in the other Contracting State if:
( a ) there is being used by the enterprise sufficient equipment as is
necessary to carry out its activities in that other State; or
( b ) it carries on supervisory activities in that State in connection with the
use of equipment referred to in sub-paragraph ( a ).
5. Where a person - other than an agent of an independent status to whom
paragraph 6 applies - is acting in a Contracting State, on behalf of the enterprise of
the other Contracting State, the enterprise shall be deemed to have a permanent
establishment in the first-mentioned Contracting State, if such person:
( a ) has and habitually exercises in the first-mentioned State, an authority to
conclude contracts on behalf of the enterprise, unless his activities are
limited to the purchase of goods or merchandise for the enterprise;
( b ) has no such authority, but habitually maintains in the first-mentioned
State a stock of goods or merchandise from which he regularly delivers
goods or merchandise on behalf of the enterprise;
( c ) has no such authority, but habitually secures orders in the first-
mentioned State wholly or almost wholly for the enterprise or for the
enterprise and other enterprises which are controlled by it or have a
controlling interest in it.
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 State through a broker, general commission agent or any other
agent of an independent status, where 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 the enterprise, he shall not be considered as agent if an
independent status if the transactions between the agent and the enterprise were not
made under arm’s length conditions.
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 Contacting 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.
CHAPTER III
TAXATION OF INCOME
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 State.
2. The term "immovable property" shall have the meaning which it has under
the law of the Contracting State in which the property in question is situated. The
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term shall in any case include property accessory to immovable property, 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 or to explore for, mineral deposits, sources and other natural resources.
Ships, boats 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 the 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 income or profits of an enterprise of a Contracting State shall be taxable
only in that 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 income or profits of the enterprise may be taxed in the
other 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 income or 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 or with
other associated enterprises with which it deals.
3. In the determination of the profits of a permanent establishment, there shall
be allowed as deductions expenses which are incurred for the purposes of the
business 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.
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. For the purposes of the preceding paragraphs, the income or profits to be
attributed to the permanent establishment shall be determined by the same method
year by year unless there is good and sufficient reason to the contrary.
6. The provisions of this Article shall also apply to the participation of a
partner in the profits of an association of persons ( société de personnes ) including  de
facto  partnership ( société de fait ) and an arrangement in participation ( association
en participation ).
7. Where profits include items of income which are dealt with separately in
other Articles of this Convention, then the provisions of those Articles shall not be
affected by the provisions of this Article.
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Article 8
INTERNATIONAL TRAFFIC
1. Profits derived from the operation of ships, aircraft or road vehicles in
international traffic shall be taxable only in the Contracting State in which the place
of effective management of the enterprise is situated.
2. If the place of effective management of a shipping enterprise is aboard a
ship or boat, then it shall be deemed to be situated in a Contracting State in which
the home harbour of the ship or boat is situated, or, if there is no such home harbour,
in the Contracting State of which the operator of the ship or boat is a resident.
3. Profits derived from the operation of ships, aircraft or road vehicles between
points which are situated in a Contracting State are taxable only in that State.
4. The provisions of paragraph 1 shall also apply to profits from the
participation in a pool, a joint business or an international operating agency.
Article 9
ASSOCIATED ENTERPRISES
1. 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 income or 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 income or profits of that
enterprise and taxed accordingly.
2. Where a Contracting State includes in the profits of an enterprise of that
State and taxes accordingly, profits on which an enterprise of the other Contracting
State has been charged to tax in that other State and the profits so included are
profits which would have accrued to the enterprise of the first-mentioned State if the
conditions made between the two enterprises had been those which would have been
made between independent enterprises, then that other State shall make an
appropriate adjustment to the amount of the tax charged therein on those profits. In
determining such adjustment, due regard shall be had to the other provisions of this
Convention and the competent authorities of the Contracting States shall if necessary
consult each other.
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 State.
2. However, such dividends may also be taxed in the Contracting State of
which the company paying the dividends is a resident and according to the laws of
that State, but if the recipient is the beneficial owner of the dividends, the tax so
charged shall not exceed 10 per cent of the gross amount of the dividends.
3. Notwithstanding the provisions of paragraph 2, where under the law of
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Malta a shareholder in receipt of a dividend is entitles to set off against his tax an
amount corresponding to the tax paid or payable by the company in respect of the
profits distributed to him by way of such dividend, then Malta tax on the dividends
may exceed the rate set out in paragraph 2 hereof but shall not exceed that
chargeable on the profits out of which dividends are paid and, in any case, shall not
exceed 35 per cent of the gross amount of the dividends. The provisions of this
paragraph shall be applicable only as long as Malta does not introduce corporation
tax or a similar tax.
4. The term "dividends" as used in this Article means income from shares,
jouissance shares or jouissance rights, mining shares, founders 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 State of which the company making the distribution is a
resident.
5. The provisions of paragraphs 1 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 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.
6. Where a company which is a resident of a Contracting State derives profits
or income from the other Contracting State, that other 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 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 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 such
other 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 State.
2. However, such interest may also be taxed in the Contracting State in which
it arises and according to the laws of that State, but if the recipient is the beneficial
owner of the interest, the tax so charged shall not exceed 12 per cent of the gross
amount of the interest.
3. Notwithstanding the provisions of paragraph 2, interest arising in a
Contracting State shall be exempt from tax in that State if it is derived by the
Government of the other Contracting State or a local authority thereof.
4. 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. Penalty charges for late payment
shall not be regarded as interest for the purpose of this Article.
5. The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner
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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 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.
6. Interest shall be deemed to arise in a Contracting State when the payer is
that State itself, a political subdivision, a local authority or a resident of that 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 State in which the permanent
establishment or fixed base is situated.
7. 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 payments shall remain
taxable according to the laws of each Contracting State, due regard being had to the
other provisions of this Convention.
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 State.
2. However, such royalties may also be taxed in the Contracting State in which
they arise and according to the laws of that State, but if the recipient is the beneficial
owner of the royalties, the tax so charged shall not exceed 12 percent of the gross
amount of the royalties.
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 television broadcasting), any patent, trade mark, design or model, plan,
secret formula or process, or for the use of, or the right to use, industrial,
commercial, agricultural, or scientific equipment, or for information concerning
industrial, commercial or scientific experience or for technical or economic studies
or for technical assistance.
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 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
that State itself, a political subdivision, a local authority or a resident of that State.
Where, however, the person paying the royalties, whether he is a resident of a
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Contracting State or not, has in a Contracting State a permanent establishment or
fixed base in connection with which the obligation 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 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 law of each Contracting State, due
regard being had to the other provisions of this Convention.
Article 13
ALIENATION OF PROPERTY
1. Income or 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 State.
2. Income or gains from the alienation of shares or comparable interests in a
company, the assets of which consist wholly or principally of immovable property,
may be taxed in the Contracting State in which the assets are situated.
3. Income or 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 with the whole enterprise)
or of such fixed base, may be taxed in that other State.
4. Income or gains derived by an enterprise from the alienation of ships,
aircraft or road vehicles operated in international traffic or movable property
pertaining to the operation of such ships, aircraft or road vehicles shall be taxable
only in that Contracting State in which the place of effective management is situated. 
5. Income or gains from the alienation of any property or assets, other than
those referred to in paragraphs 1, 2, 3 and 4, shall be taxable only in the Contracting
State of which the alienator is a resident.
Article 14
INDEPENDENT PERSONAL SERVICES
1. Income derived by a resident of a Contracting State in respect of
professional services or other activities of an independent character shall be taxable
only in that State except in the following circumstances, when such income may also
be taxed in the other Contracting State:
( a ) if he has a fixed base regularly available to him in the other Contracting
State for the purpose of performing his activities; in that case, only so
much of the income as is attributable to that fixed base may be taxed in
that other Contracting State; or
( b ) if his stay in the other Contracting State is for a period or periods
amounting to or exceeding in the aggregate 183 days in any twelve-
month period; in that case, only so much of the income as is derived
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from the activity exercised in the other Contracting State may be taxed
in that other State; or
( c ) if the remuneration for his services in the other Contracting State is
derived from residents of that State and exceeds 50000 United States
Dollars or its equivalent during the calendar year, notwithstanding that
his stay in that State is for a period or periods amounting in the
aggregate to less than 183 days during that year.
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 and accountants.
Article 15
DEPENDENT PERSONAL SERVICES
1. Subject to the provisions of Articles 16, 18 and 19, 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 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 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 State for a period or periods not
exceeding in the aggregate 183 days in any twelve-month period, and
( b ) the remuneration is paid by, or on behalf of, an employer who is not a
resident of the other State, and
( c ) the remuneration is not borne by a permanent establishment or a fixed
base which the employer has in the other State.
3. Notwithstanding the preceding provisions of this Article, remuneration
derived in respect of an employment exercised aboard a ship, aircraft or road vehicle
operated in international traffic may be taxed in the Contracting State in which the
place of effective management of the enterprise is situated.
Article 16
DIRECTORS’ FEES
Directors’ fees and other similar payments derived by a resident of one of
the Contracting States in his capacity as a member of the board of directors, or other
comparable body however described, of a company which is a resident of the other
Contracting State may be taxed in that other State.
Article 17
ARTISTES AND SPORTSMEN
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 a sportsman, 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
a sportsman in his capacity as such accrues not to the entertainer or sportsman
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
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entertainer or sportsman are exercised.
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 State.
2. Notwithstanding the provisions of paragraph 1, pensions paid and other
payments made under a public scheme which is part of the social security system of
a Contracting State shall taxable in that State. However the tax so charged shall not
exceed 10 per cent of the gross amount of the pensions or other payments.
Article 19
GOVERNMENT SERVICE
1. ( a ) Salaries, wages and other similar remuneration, other than a pension,
paid by a Contracting State or a political subdivision or a local authority
thereof to an individual in respect of services rendered to that State or
subdivisdion or authority shall be taxable only in that State.
( b ) However, such salaries, wages and other similar remuneration shall be
taxable only in the other Contracting State if the services are rendered in
that State and the individual is a resident of that State who:
(i) is a national of that State; or
(ii) did not become a resident of that State solely for the purposes of
rendering the services.
2. ( a ) Any pension paid by, or out of funds created by, a Contracting State or a
political subdivision or local authority thereof to an individual in respect
of services rendered to that State or subdivision or authority shall be
taxable in that State. However the tax so charged shall not exceed 10 per
cent of the gross amount of the pensions.
( b ) However, such pension shall be taxable only in the other Contracting
State if the individual is a resident of, and a national of, that State.
3. The provisions of Articles 15, 16 and 18 shall apply to salaries, wages and
other similar remuneration, and to pensions, in respect of services rendered in
connection with a business carried on by a Contracting State or a political
subdivision or a local authority thereof.
Article 20
STUDENTS AND BUSINESS APPRENTICES
A student or business apprentice who is present in a Contracting State solely
for the purpose of his education or training and who is, or immediately before being
so present was, a resident of the other Contracting State, shall be exempt from tax in
the first-mentioned State on payments received from outside that first-mentioned
State for the purposes of his maintenance, education or training.
Article 21
OTHER INCOME
1. Items of income of a resident of a Contracting State, wherever arising, not
dealt with in the foregoing Articles of this Convention shall be taxable only in that
State.
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE REPUBLIC OF TUNISIA _g S.L.123.64 13
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 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.
CHAPTER IV
ELIMINATION OF DOUBLE TAXATION
Article 22
ELIMINATION OF DOUBLE TAXATION
1. Where a resident of a Contracting State derives income which, in accordance
with the provisions of this Convention, may be taxed in the other Contracting State,
the first-mentioned State shall allow as a credit against the relative tax on the income
of that resident an amount equal to the income tax paid in that other Contracting
State. However such credit shall not exceed that part of the tax which is attributable
to this income.
2. For the purpose of allowance as a credit under paragraph 1, the tax payable
in a Contracting State shall be deemed to include the tax which is otherwise payable
in that Contracting State but has been reduced or waived by that State under its
domestic law. For the purpose of this paragraph, interest and royalties shall be
deemed to have been charged at the rates laid down in paragraph 2 of Article 11 and
paragraph 2 of Article 12 respectively.
3. Where a company which is a resident of a Contracting State pays a dividend
to a person resident in the other Contracting State, the credit in that other
Contracting State shall take into account (in addition to any tax for which credit may
be allowed under paragraph 1 of this Article) the tax paid or that which would be
payable by the first-mentioned company, in respect of which such dividend is paid,
but which has been reduced or waived by that State under its domestic law.
However such credit shall not exceed that part of the tax which is
attributable to these dividends. No tax shall be paid by shareholders on such
dividends when these are redistributed.
4. Where the Convention provides that income arising in a Contracting State
shall be relieved from tax in that State, either in full or in part, and, under the law in
force in the other Contracting State, such income is subject to tax by reference to the
amount thereof which is remitted to or received in that other State and not by
reference to the full amount thereof, then the relief to be allowed in the first-
mentioned State shall apply only to so much of the income as is remitted to or
received in the other State.
CHAPTER V
SPECIAL PROVISIONS
Article 23
NON-DISCRIMINATION
1. 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 State in the same circumstances, in particular with respect to
14 _g S.L.123.64
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE REPUBLIC OF TUNISIA
residence, 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 State than the taxation levied on enterprises of that other State
carrying on the same activities. This provision shall not be construed as obliging a
Contracting State to grant to residents of the other Contracting State any personal
allowances, reliefs and reduction for taxation purposes on account of civil status or
family responsibilities which it grants to its own residents.
3. Except where the provisions of paragraph 1 of Article 9, paragraph 7 of
Article 11, or paragraph 6 of Article 12 apply, interest, royalties and other
disbursements paid by an enterprise of a Contracting State to a resident of the other
Contracting State shall, for the purpose of determining the taxable profits of such
enterprise, be deductible under the same conditions as if they had been paid to a
resident of the first-mentioned 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. The provisions of this Article shall, notwithstanding the provisions of
Article 2, apply to taxes of every kind and description which are the subject of this
Convention.
Article 24
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 Convention, he may, irrespective of the remedies provided by the domestic
law of those 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 23,
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 Convention.
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
Convention. Any agreement reached shall be implemented notwithstanding any time
limits in the domestic law 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 Convention. They may also consult together for
the elimination of double taxation in cases not provided for in the Convention.
4. The competent authorities of the Contracting States may communicate with
each other directly for the purpose of reaching an agreement in the sense of the
preceding paragraphs. When it seems advisable in order to reach agreement to have
an oral exchange of opinions, such exchange may take place through a Commission
consisting of representatives of the competent authorities of the Contracting States.
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE REPUBLIC OF TUNISIA _g S.L.123.64 15
Article 25
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 Convention or of
the domestic laws of the Contracting States concerning taxes covered by the
Convention insofar as the taxation thereunder is not contrary to the Convention. Any
information received by a Contracting State shall be treated as secret in the same
manner as information obtained under the domestic laws of that State 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
Convention. 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
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 would disclose any trade, business,
industrial, commercial or professional secret or trade process, or
information, the disclosure of which would be contrary to public policy
( ordre public ).
Article 26
MEMBERS OF DIPLOMATIC MISSIONS AND CONSULAR POSTS
Nothing in this Convention shall affect the fiscal privileges of members of
diplomatic missions or consular posts under the general rules of international law or
under the provisions of special agreements.
Article 27
ENTRY INTO FORCE
The Contracting States shall notify each other of the completion of the
procedures required by their law for the entry into force of this Convention. This
Convention shall enter into force thirty days after the date of the later of these
notifications. These provisions shall have effect:
(i) in respect of taxes withheld at source, on income paid or credited
on or after the first day of January of the calendar year next
following that in which the Convention enters into force; and
(ii) in respect of other taxes on income derived during any calendar
year or accounting period, as the case may be, beginning on or
after the first day of January immediately following the date on
which this Convention enters into force.
Article 28
TERMINATION
This Convention shall remain in force indefinitely but either of the
Contracting States may, on or before the thirtieth day of June in any calendar year
16 _g S.L.123.64
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE REPUBLIC OF TUNISIA
from the fifth year following that in which the Convention enters into force, give to
the other Contracting State, through diplomatic channels, written notice of
termination. In such event, the Convention shall cease to have effect:
(i) in respect of taxes withheld at source, on income paid or credited
on or after the first day of January in the calendar year next
following that in which the notice is given; and
(ii) in respect of other taxes on income derived during any calendar
year or accounting period, as the case may be, beginning on or
after the first day of January immediately following the date on
which the notice is given.
IN WITNESS WHEREOF, the undersigned, duly authorised thereto by their
respective Governments, have signed this Convention.
DONE in duplicate at Valletta, this 31st day of May of the year two thousand in
the Arabic, French and English languages and, in case there is any divergence of
interpretation, the English and French texts shall prevail.
 Dr. Joe Borg Mr Habib Ben Yahia
Minister of Foreign Affairs Minister of Foreign Affairs
For the Government of Malta For the Government of the Republic of Tunisia
PROTOCOL
At the moment of the signature of the Convention between the Government
of the Republic of Tunisia and the Government of Malta for the Avoidance of
Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on
Income, both parties have agreed upon the following provisions, which form an
integral part of the Convention:
1. With reference to Article 7, each Contracting State shall tax the profit from
the business of insurance in accordance with the provisions of its own law.
2. With reference to Article 22, it is understood that the provisions of
paragraph 3 thereof shall also apply to distributions of the profits of a company of a
Contracting State attributable to a permanent establishment in the other Contracting
State.
IN WITNESS whereof, the undersigned, being duly authorised therein by their
respective Governments, have signed this Protocol.
DONE in duplicate at Valletta, this 31st day of May of the year two thousand in
the Arabic, French and English languages and, in case there is any divergence of
interpretation, the English and French texts shall prevail.
 Dr. Joe Borg Mr Habib Ben Yahia
Minister of Foreign Affairs Minister of Foreign Affairs
For the Government of Malta For the Government of the Republic of Tunisia
