DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK [ S.L.123.47 1
SUBSIDIARY LEGISLATION 123.47
DOUBLE TAXATION RELIEF ON TAXES ON 
INCOME WITH THE KINGDOM OF DENMARK 
ORDER
30th December, 1998
LEGAL NOTICE 124 of 1999. 
Title.
on Income with the Kingdom of Denmark 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 Government of the Kingdom of Denmark with a
view to affording relief from double taxation in
relation to the following taxes imposed by the laws of
the Kingdom of Denmark:
(i) the income tax to the State;
(ii) the income tax to the municipalities;
(iii) the income tax to the county municipalities;
(iv) taxes imposed under the Hydrocarbon Tax Act;
( b ) that it is expedient that those arrangements should
have effect.
2 [ S.L.123.47
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK
SCHEDULE
CONVENTION 
BETWEEN 
THE GOVERNMENT OF THE KINGDOM OF DENMARK
AND 
THE GOVERNMENT OF THE REPUBLIC OF MALTA 
FOR THE AVOIDANCE OF DOUBLE TAXATION 
AND THE PREVENTION OF FISCAL EVASION
WITH RESPECT TO TAXES ON INCOME
The Government of the Kingdom of Denmark and the Government of the Republic
of Malta, 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:
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 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, taxes on the total amounts of wages or salaries paid
by enterprises, as well as taxes on capital appreciation.
3. The existing taxes to which the Convention shall apply are in particular:
( a )  in Denmark~
(i) the income tax to the State (indkomsskatten tit staten);
(ii) the income tax to the municipalities (den kommunale
indkomstskat);
(iii) the income tax to the county municipalities (den amtskommunale
indkomstskat);
(iv) taxes imposed under the Hydrocarbon Tax Act (skatter i henhold
til kulbrinteskatteloven);
(hereinafter referred to as "Danish tax").
( b ) in 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 substantial changes which have been made in their
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK [ S.L.123.47 3
respective taxation laws.
ARTICLE 3
General Definitions
1. For the purposes of this Convention, unless the context otherwise requires:
( a ) the terms "a Contracting State" and "the other Contracting State" mean
Denmark or Malta, as the context requires;
( b ) the term "Denmark" means the Kingdom of Denmark including any area
outside the territorial sea of Denmark which in accordance with international law has
been or may hereafter be designated under Danish laws as an area within which
Denmark may exercise sovereign rights with respect to the exploration and
exploitation of the natural resources of the sea-bed or its subsoil and the superjacent
waters and with respect to other activities for the exploration and economic
exploitation of the area; the term does not comprise the Faroe Islands and Greenland;
( c ) the term "Malta" means the Republic of Malta and, when used in a
geographical sense, means the Island of Malta, the Island of Gozo and the other
islands of the Maltese archipelago including the territorial waters thereof, as well as
any area of the sea-bed, its sub-soil and the superjacent water column adjacent to the
territorial waters, wherein the Republic of Malta exercices sovereign rights,
jurisdiction, or control in accordance with international law and its national law,
including its legislation relating to the exploration of the Continental Shelf and
exploitation of its natural resources;
( d ) the term "person" includes an body of persons;
( e ) the term "company" means any body corporate or any entity that 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 "international traffic" means any transport by a ship or aircraft,
operated by an entexprise of a Contracting State, except when the ship or aircraft is
operated solely between places in the other Contracting State;
( h ) the term "competent authority" means:
(i) in Denmark:
the Minister for Taxation or his authorised representative;
(ii) in Malta:
the Minister responsible for fmance or his authorised representative;
( i ) the term "national" means:
(i) any individual possessing the nationality of a Contracting State;
(ii) any legal person, partnership or association deriving its status as such
from the laws in force in a Contracting State.
2. As regards the application of the Convention at any time by a Contracting
State, any term not defined therein shall, unless the context otherwise requires, have
the meaning that it has at that time under the law of that State for the purposes of the
taxes to which the Convention applies, any meaning under the applicable tax laws of
that State prevailing over a meaning given to the term under other laws of that State.
4 [ S.L.123.47
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK
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 management or any other criterion of a
similar nature, and also includes that state and any political subdivision or local
authority thereof. This term however, does not include any person who is liable to
tax in that State in respect only of income from sources in that 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 only 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 (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 only 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 only of the 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; 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 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.
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK [ S.L.123.47 5
4. 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 purpese 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 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 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 paragraph 6 applies - is acting
on behalf of an enterprise and has, and habitually exercises, in a Contracting State an
authority to conclude contracts in the name of the enterprise, that enterprise shall be
deemed to have a permanent establishment in that State in respect of any activities
which that person undertakes for the enterprise, unless the activities of such person
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 shall not be deemed to have a permanent establishment in a
Contracting State merely because it carries on business in that 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.
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 (including income from agriculture or forestry) 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
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;
6 [ S.L.123.47
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK
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 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 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 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 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.
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. For the purposes of the preceding paragraphs, the 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.
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.
ARTICLE 8
Shipping and Air Transport
1. Profits derived by an enterprise of a Contracting State from the operation of
ships and aircraft in international traffic shall be taxable only in that State.
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK [ S.L.123.47 7
2. Profits derived by an enterprise of a Contracting State from the use,
demurrage, or rental of containers (including trailers, barges and related equipment
for the transport of containers) used for the transport of goods or merchandise shall
be taxable only in that State, except where such containers, trailers, barges and
related equipment are used for transport solely between places within the other
Contracting State.
3. The provisions of paragraph 1 shall also apply to profits from the
participation in a pool, a joint business or an international operating agency.
4. With respect to profits derived by the Danish, Norwegian and Swedish air
transport consortium, the Scandinavian Airlines System (SAS), the provisions of
paragraphs 1 and 3 shall apply only to such proportion of the profits as corresponds
to the participation held in that consortium by SAS Denmark A/S, the Danish partner
of Scandinavian Airlines System.
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 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.
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:
( a ) where the dividends are paid by a company which is a resident of
8 [ S.L.123.47
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK
Denmark to a resident of Malta which is the beneficial owner thereof,
the Danish tax so charged shall not exceed:
(i) 0 per cent of the gross amount of the dividends if the beneficial
owner is a company (other than a partnership) which holds and
has held directly at least 25 per cent of the capital of the company
paying the dividends for a twelve month period prior to the date
the dividends are declared;
(ii) 15 per cent of the gross amount of the dividends in all other cases;
( b ) where the dividends are paid by a company which is a resident of Malta
to a resident of Denmark who is the beneficial owner thereof, Malta tax
on the gross amount of the dividends shall not exceed that chargeable on
the profits out of which the dividends are paid.
The competent authorities of the Contracting States shall by mutual agreement
settle the mode of application of these limitations.
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 State of which the company making the distribution is
a resident.
4. 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.
5. 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.
6. Where a Contracting State has levied the tax at the source in excess of the
amount of tax chargeable under the provisions of this Convention, application for the
refund of the excess amount must be lodged with the competent authority of that
State within a period of four years after the expiration of the calendar year in which
the tax was levied. The refund shall be given within a six month period from the date
on which the application was submitted to the competent authority. The six month
period may be extended if both of the Contracting States agree that the necessary
documentation has not been presented to the competent authority of the first-
mentioned State.
7. The provisions of this Article shall not apply if it was the main purpose or
one of the main purposes of any person concerned with the creation or assignment of
the shares or other rights in respect of which the dividend is paid to take advantage
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK [ S.L.123.47 9
of this Article by means of that creation or assignment.
In the event that a resident of a Contracting State is denied relief from taxation in
the other Contracting State by reason of the provisions of the first sentence of this
paragraph, the competent authority of that other State shall notify the competent
authority of the first-mentioned State.
ARTICLE 11
Interest
1. Interest arising in a Contracting State and paid to a resident of the other
Contracting State shall be taxable only in that other State if such resident is the
beneficial owner of the interest.
2. 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.
3. The provisions of paragraph 1 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 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.
4. 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.
5. The provisions of this Article shall not apply if it was the main purpose or
one of the main purposes of any person concerned with the creation or assignment of
the debt-claim in respect of which the interest is paid to take advantage of this
Article by means of that creation or assignment.
In the event that a resident of a Contracting State is denied relief from taxation in
the other Contracting State by reason of the provisions of the first sentence of this
paragraph, the competent authority of that other State shall notify the competent
authority of the first-mentioned State.
ARTICLE 12
Royalties
1. Royalties arising in a Contracting State and paid to a resident of the other
Contracting State shall be taxable only in that other State if such resident is the
beneficial owner of the royalties.
2. 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
10 [ S.L.123.47
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK
literary, artistic or scientific work including cinematograph films, any patent, trade
mark, design or model, plan, secret formula or process, or for information
concerning industrial, commercial or scientific experience.
3. The provisions of paragraph 1 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.
4. 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 Convention.
5. The provisions of this Article shall not apply if it was the main purpose or
one of the main purposes of any person connected with the creation or assignment of
the rights in respect of which the royalties are paid to take advantage of this Article
by means of that creation or assignment.
In the event that a resident of a Contracting State is denied relief from taxation in
the other Contracting State by reason of the provisions of the first sentence of this
paragraph, the competent authority of that other State shall notify the competent
authority of the first-mentioned State.
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 State.
2. Gains from the alienation of shares or comparable interests in a company the
assets of which consist directly or indirectly principally of immovable property
situated in a Contracting State may be taxed in that State.
3. Gains from the alienation of movable properly 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. Gains derived by an enterprise of a Contracting State from the alienation of
ships or aircraft operated in international traffic or movable property pertaining to
the operation of such ships or aircraft, shall be taxable only in that State.
5. Gains derived by an enterprise of a Contracting State from the alienation of
containers (including trailers, barges and related equipment for the transport of
containers) used for the transport of goods and merchandise shall be taxable only in
that State, except where such containers, trailers, barges and related equipment are
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK [ S.L.123.47 11
used for transport solely between places within the other Contracting State.
6. Gains from the alienation of any property other than that referred to in
paragraphs 1, 2, 3, 4 and 5 shall be taxable only in the Contracting State of which the
alienator is a resident.
7. With respect to gains derived by the Danish, Norwegian and Swedish air
transport consortium, the Scandinavian Airlines System (SAS), the provisions of
paragraph 4 shall apply only to such proportion of the gains as corresponds to the
participation held in that consortium by SAS Denmark A/S, the Danish partner of
Scandinavian Airlines System.
ARTICLE 14
Independent Personal Services
I . 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. However, such income may be taxed in the other Contracting State
in the following circumstances:
( 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 commencing or ending in the fiscal year concerned; in
that case, only so much of the income as is derived from the activity
exercised in the other Contracting State may be taxed in that other State.
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 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
commencing or ending in the fiscal year concerned, and
( b ) the remuneration is paid by, or on behalf of, an employer who is a
resident of the first-mentioned 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
12 [ S.L.123.47
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK
derived in respect of an employment exercised aboard a ship or aircraft operated in
international traffic by an enterprise of a Contracting State may be taxed in the
Contracting State of which the enterprise operating the ship or aircraft is a resident
provided that such remuneration is subject to tax in that Contracting State.
Where a resident of Denmark derives remuneration in respect of an employment
exercised aboard an aircraft operated in international traffic by the consortium
Scandinavian Airlines System (SAS), such remuneration shall be taxable only in
Denmark.
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 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
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
entertainer or sportsman are exercised.
3. The provisions of paragraphs 1 and 2 shall not apply to income derived from
activities performed in a Contracting State by artistes or sportsmen if the visit to that
State is substantially supported by public funds of the other Contracting State or a
political subdivision or a local authority thereof.
ARTICLE 18
Pensions and Similar Payments
1. Subject to the provisions of paragraph 2 of Article 19, pensions, annuities
and other similar remuneration paid to a resident of a Contracting State shall be
taxable only in that State.
2. Notwithstanding the provisions of paragraph 1, payments received by an
individual, being a resident of a Contracting State, under the social security
legislation of the other Contracting State, or under any other scheme out of funds
created by that other State or a political subdivision or a local authority thereof, shall
be taxable only in that other State.
3. In the case of an individual who was a resident of a Contracting State and
has become a residnet of the other Contracting State, the provisions of paragraph 1
shall not affect the right of the first-mentioned State under its national laws to tax
pensions, annuities and other similar remuneration accruing to such individual from
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK [ S.L.123.47 13
sources within that State.
4. The term ''annuities'' means stated sums payable periodically at stated times,
during life or during a specified or ascertainable period of time, under an obligation
to make the payments in return for adequate and full consideration in money or
money’s worth.
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 individidual in respect of services rendered to that State or subdivision 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 renedered 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 purpose of
rendering the services.
2. ( a ) Any pension paid by, or out of funds created 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 subdivision or authority shall be taxable only in
that State.
( 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, 17 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
Payments which a student or business apprentice who is or was immediately
before visiting a Contracting State a resident of the other Contracting State and who
is present in the first-mentioned State solely for the purpose of his education or
training receives for the purpose of his maintenance, education or training shall not
be taxed in that State, provided that such payments arise from sources outside that
State
ARTICLE 21
Activities in connection with Preliminary Surveys, Exploration or Extraction of 
Hydrocarbons
1. Notwithstanding the provisions of Articles 5 and 14, a resident of a
Contracting State who carries on activities in connection with preliminary surveys,
exploration or extraction of hydrocarbons situated in the other Contracting State
shall be deemed to be carrying on in respect of such activities a business in that other
State through a permanent establishment or to be performing independent personal
services from a fixed base situated therein.
14 [ S.L.123.47
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK
2. The provisions of paragraph 1 shall not apply where the activities are carried
on for a period or periods not exceeding 30 days in the aggregate in any twelve
month period. However, for the purpose of this paragraph, activities carried on by an
enterprise associated with another enterprise within the meaning of Article 9 shall be
deemed to be carried on by the enterprise with which it is associated if the activities
in question are substantially the same as those carried on by the last-mentioned
enterprise.
3. Notwithstanding the provisions of paragraphs 1 and 2, drilling rig activities
carried on offshore shall constitute a permanent establishment only if the activities
are carried on for a period or periods exceeding 183 days in the aggregate in any
twelve month period. However, for the purpose of this paragraph, activities carried
on by an enterprise associated with another enterprise within the meaning of Article
9 shall be deemed to be carried on by the enterprise with which it is associated if the
activities in question are substantially the same as those carried on by the last-
mentioned enterprise.
4. Notwithstanding the provisions of Article 13, capital gains on drilling rigs
used for activities, as mentioned in paragraph 3, which are deemed to be derived by
a resident of a Contracting State when the activities cease to be subject to tax in the
other Contracting State, shall be exempt from tax in that other State. For the purpose
of this paragraph, the term "capital gains" means the amount by which the market
value at the moment of transfer exceeds the residual value at that moment, as
increased by any depreciation taken.
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 Convention shall be taxable only in that
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 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.
ARTICLE 23
Elimination of Double Taxation
Double taxation shall be avoided as follows:
1. in the case of Denmark:
( a ) subject to the provisions of sub-paragraph ( c ), where a resident of
Denmark derives income which, in accordance with the provisions of
this Convention, may be taxed in Malta, Denmark shall allow as a
deduction from the tax on the income of that resident, an amount equal
to the income tax paid in Malta;
( b ) such deduction shall not, however, exceed that part of the income tax, as
computed before the deduction is given, which is attributable to the
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK [ S.L.123.47 15
income which may be taxed in Malta;
( c ) where a resident of Denmark derives income which, in accordance with
the provisions of this Convention, shall be taxable only in Malta,
Denmark may include this income in the tax base, but shall allow as a
deduction from the income tax that part of the income tax which is
attributable to the income derived from Malta.
2. in the case of Malta:
Subject to the provisions of the law of Malta regarding the allowance of a credit
against Malta tax in respect of foreign tax, where, in accordance with the provisions
of this Convention, there is included in a Malta assessment income from sources
within Denmark, the Danish tax on such income shall be allowed as a credit against
the relative Malta tax payable thereon.
ARTICLE 24
Limitation of Relief
1. Where under any provision of this Convention any income is relieved from
tax in a Contracting State and, under the law in force in the other Contracting State,
a person, in respect of that income, is subject to tax by reference to the amount
thereof which is remitted to or received in that other Contracting State and not by
reference to the full amount thereof, then the relief to be allowed under this
Convention in the first-mentioned State shall apply only to so much of the income as
is taxed in the other Contracting State.
2. The provisions of this Convention shall not apply to persons entitled to any
special tax benefits under:
( a ) a law of either one of the Contracting States which has been identified
in an Exchange of Notes between the Contracting States; or
( b ) any substantially similar law subsequently enacted.
ARTICLE 25
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
residence, are or may be subjected. This provision shall, notwithstanding the
provisions of Article 1, also apply to persons who are not residents of one or both of
the Contracting States.
2. Stateless persons who are residents of a Contracting State shall not be
subjected in either 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 the State concerned in the same circumstances, in
particular with respect to residence, are or may be subjected.
3. 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 reductions for taxation purposes on account of civil status or
16 [ S.L.123.47
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK
family responsibilities which it grants to its own residents.
4. Except where the provisions of paragraph 1 of Article 9, paragraph 4 of
Article 11, or paragraph 4 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.
5. 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.
6. The provisions of this Article shall apply to the taxes which are the subject
of this Convention.
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 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 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 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, including through a joint commission consisting of themselves
or their representatives, for the purpose of reaching an agreement in the sense of the
preceding paragraphs.
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 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. The
exchange of information is not restricted by Article 1. Any information received by a
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK [ S.L.123.47 17
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) concerned with 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 Contcacting 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 28
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 29
Territorial Extension
1. This Convention may be extended, either in its entirety or with any
necessary modifications, to any part of the territory of Denmark which is specifically
excluded from the application of the Convention and which imposes taxes
substantially similar in character to those to which the Convention applies. Any such
extension shall take effect from such date and subject to such modifications and
conditions, including conditions as to termination, as may be specified and agreed
between the Contracting States in notes to be exchanged through diplomatic
channels.
2. Unless otherwise agreed by both Contracting States, the termination of the
Convention by one of them under Article 31 shall also terminate, in the manner
provided for in that Article, the application of the Convention to any territory to
which it has been extended under this Article.
ARTICLE 30
Entry into Force
1. The Governments of the Contracting States shall notify to each other,
through diplomatic channels, that the legal requirements for the entry into force of
this Convention have been complied with.
2. This Convention shall enter into force on the date of the later of the
notifications referred to in paragraph 1 and its provisions shall have effect:
18 [ S.L.123.47
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK
( a ) in Denmark:
in respect of taxes for the income year immediately following that in
which the Convention enters into force and subsequent income years;
( b ) in Malta:
in respect of 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 Convention
enters into force.
ARTICLE 31
Termination
This Convention shall remain in force until terminated by a Contracting State.
Either Contracting State may terminate the Convention, through diplomatic
channels, by giving notice of termination at least six months before the end of any
calendar year beginning after the expiration of a period of five years from the date of
its entry into force. In such event, the Convention shall cease to have effect:
( a ) in Denmark:
in respect of taxes for the income year immediately following that in
which the notice of termination is given and subsequent income years;
( b ) in Malta:
in respect of taxes on income recived 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 Brussels this thirteenth day of July 1998, in the English
language.
PROTOCOL
At the signing of the Convention between the Government of the Kingdom of
Denmark and the Government of the Republic of Malta for the avoidance of double
taxation and the prevention of fiscal evasion with respect to taxes on income, the
undersigned have agreed that the following provision shall form an integral part of
the Convention:
Concerning paragraph 4 of Article 13 it is understood that capital gains as
mentioned in that provision can only be taxed in the State where the owner is a
resident, even where the ship or aircraft is operated by a resident of a third state.
OLE PHILIPSON 
FOR THE GOVERNMENT OF 
THE KINGDOM OF DENMARK 
VICTOR CAMILLERI 
FOR THE GOVERNMENT OF
THE REPUBLIC OF MALTA
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE KINGDOM OF DENMARK [ S.L.123.47 19
IN WITNESS WHEREOF the undersigned, duly authorised thereto by their
respective Governments have signed this Protocol.
Done in duplicate at Brussels this thirteenth day of July 1998, in the English
language.
OLE PHILIPSON 
FOR THE GOVERNMENT OF 
THE KINGDOM OF DENMARK 
VICTOR CAMILLERI 
FOR THE GOVERNMENT OF
THE REPUBLIC OF MALTA
