DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA [ S.L.123.45 1
SUBSIDIARY LEGISLATION 123.45
DOUBLE TAXATION RELIEF ON TAXES ON 
INCOME WITH SOUTH AFRICA ORDER
12th November, 1997
LEGAL NOTICE 89 of 1998. 
Title.
on Income with South Africa Order.
Arrangements to 
have effect.
2. It is hereby declared:
( a ) that the arrangements specified in the Agreement set
out in the Schedule to this Order have been made with
the Government of South Africa with a view to
affording relief from double taxation in relation to the
following taxes imposed by the laws of South Africa:
(i) the normal tax;
(ii) the non-resident shareholders’ tax; and
(iii) the secondary tax on companies;
( b ) that it is expedient that those arrangements should
have effect.
2 [ S.L.123.45
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA
SCHEDULE
AGREEMENT 
BETWEEN MALTA AND SOUTH AFRICA
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 South Africa,
desiring to conclude an Agreement for the avoidance of double taxation and the
prevention of fiscal evasion with respect to taxes on income, have agreed as follows:
CHAPTER I 
SCOPE OF THE AGREEMENT
ARTICLE 1
Personal Scope
This Agreement shall apply to persons who are residents of one or both of the
Contracting States.
ARTICLE 2
Taxes Covered
1. The existing taxes to which this Agreement shall apply are:
( a ) in Malta:
the income tax;
(hereinafter referred to as "Malta tax");
( b ) in South Africa:
(i) the normal tax;
(ii) the non-resident shareholders’ tax; and 
(iii) the secondary tax on companies; 
(hereinafter referred to as "South African tax").
2. This Agreement shall apply also to any identical or substantially similar
taxes which are imposed after the date of signature of the Agreement in addition to,
or in place of, the existing taxes. The competent authorities of the Contracting States
shall notify each other of any significant changes which have been made in their
respective taxation laws.
3. Notwithstanding the other provisions of this Article, this Agreement shall
not apply to tax paid or payable in Malta in accordance with the provisions of sub-
article (13) of article 56 of the Income Tax Act 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
Agreement.
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA [ S.L.123.45 3
CHAPTER II 
DEFINITIONS
ARTICLE 3
General Definitions
1.  For the purposes of this Agreement, unless the context otherwise requires:
( a ) 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, and any
area outside the territorial waters of Malta which has been or may hereafter be
designated, in accordance with international law and under the law of Malta
concerning the continental shelf, as an area within which the rights of Malta with
respect to the seabed and subsoil and their natural resources may be exercised;
( b ) the term "South Africa" means the Republic of South Africa and, when used
in a geographical sense, includes the territorial sea thereof as well as any area
outside the territorial sea, including the continental shelf, which has been or may
hereafter be designated, under the laws of South Africa and in accordance with
international law, as an area within which South Africa may exercise sovereign
rights or jurisdiction;
( c ) the terms "a Contracting State" and "the other Contracting State" mean
Malta or South Africa as the context requires;
( 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 "international traffic" means any transport by a ship or aircraft
operated by an enterprise 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 Malta: the Minister responsible for finance or his authorised
representative;
(ii) in South Africa: the Commissioner for Inland Revenue 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 Agreement by a Contracting State any term
not defined therein shall, unless the context otherwise requires, have the meaning
which it has under the laws of that State concerning the taxes to which this
Agreement applies.
4 [ S.L.123.45
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA
ARTICLE 4
Resident
1. For the purposes of this Agreement, the term "resident of a Contracting
State" means:
( a ) in the case of Malta, a person who is resident in Malta for the purposes
of Malta tax; and
( b ) in the case of South Africa, any individual who is ordinarily resident in
South Africa and any other person which has its place of effective
management in South Africa.
2. Where by reason of the provisions of paragraph 1 an individual is a resident
of both Contracting States, then his status shall be determined as follows:
( a ) he shall be deemed to be a resident of the State in which he has a
permanent home available to him; if he has a permanent home available
to him in both States, he shall be deemed to be a resident of the State
with which his personal and economic relations are closer (centre of
vital interests);
( b ) if the State in which he has his centre of vital interests cannot be
determined, or if he has no 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 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 of the State in which its place of effective management is situated, or, if that
cannot be established, the competent authorities of the Contracting States shall settle
the question by mutual agreement and determine the mode of application of this
Agreement to such person.
ARTICLE 5
Permanent Establishment
1. For the purpose of this Agreement, the term "permanent establishment"
means a fixed place of business through which the business of an enterprise is
wholly or partly carried on.
2. The term "permanent establishment" includes especially:
( a ) a place of management; 
( b ) a branch;
( c ) an office; 
( d ) a factory;
( e ) a workshop; and
( f ) a mine, an oil or gas well, a quarry or any other place of extraction of
natural resources including an offshore drilling site.
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA [ S.L.123.45 5
3. The term "permanent establishment" likewise encompasses:
( a ) a building site, a construction, assembly or installation project or
supervisory activities in connection therewith, but only where such site,
project or activities continue for a period of more than six months;
( b ) the furnishing of services, including consultancy services, by an
enterprise through employees or other personnel engaged by the
enterprise for such purpose, but only where activities of that nature
continue (for the same or a connected project) within the Contcacting
State for a period or periods aggregating more than six months within
any 12-month period.
4. An enterprise of a Contracting State shall be deemed to have a permanent
establishment in the other Contracting State if equipment is being used or installed
in that other State, or supervision thereof is carried out, by, for or under contract
with the enterprise during a period or periods aggregating more than six months
within any 12-month period.
5. 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, 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.
6. Notwithstanding the provisions of paragraphs 1 and 2, where a person -
other than an agent of an independent status to whom paragraph 7 applies - is acting
on behalf of an enterprise and has, and habitually exereises, 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 5 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.
7. 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, provided that such persons are acting in the ordinary
course of their business. However, when the activities of such an agent are devoted
wholly or almost wholly on behalf of that enterprise and the transactions between
that agent and the enterprise are not made under arm’s length conditions, he will not
6 [ S.L.123.45
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA
be considered an agent of an independent status within the meaning of this
paragraph.
8. 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.
CHAPTER III 
TAXATION OF INCOME
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 immovable 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 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 or with other associated
enterprises with which it deals.
3. In determining the profits of a permanent establishment, there shall be
allowed as deductions expenses which are incurred for the purposes of the
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA [ S.L.123.45 7
permanent establishment, including executive and general administrative expenses
so incurred, whether incurred in the Contracting 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 purpose 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 Agreement, then the provisions of those Articles shall not be
affected by the provisions of this Article.
8.  The provisions of this Article shall not affect the provisions of the law of a
Contracting State regarding the taxation of profits from the business of insurance.
ARTICLE 8
International Traffic
1. Profits of an enterprise of a Contracting State from the operation of ships or
aircraft in international traffic shall be taxable only in that State.
2. For the purposes of this Article, profits from the operation of ships or
aircraft in international traffic shall include:
( a ) profits derived from the rental on a bare boat basis of ships or aircraft
used in international traffic,
( b ) profits derived from the use or rental of containers,
if such profits are incidental to the profits to which the provisions of paragraph 1
apply.
3. The provisions of paragraph 1 shall also apply to profits derived 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
8 [ S.L.123.45
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA
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 Agreement 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 Ma1ta
to a resident of South Africa 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;
( b ) where the dividends are paid by a company which is a resident of South
Africa to a resident of Malta who is the beneficial owner thereof, the
South African tax so charged shall not exceed 5 per cent of the gross
amount of the dividends.
This paragraph shall not affect the taxation of the company in respect of profits
out of which the dividends are paid.
3. The term "dividends" as used in this Article means income from shares or
other rights participating in profits (not being debt claims), as well as income from
other corporate rights which is subjected to the same taxation treatment as income
from shares by the laws of the Contracting State of which the company making the
distribution is a resident.
4. The provisions of paragraphs 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 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
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA [ S.L.123.45 9
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 Stats 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 10 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 political sub-division or a local
authority thereof, or any agency wholly owned and controlled by that Government or
sub-division or authority.
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
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 sub-division, 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 Agreement.
10 [ S.L.123.45
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA
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 10 per cent 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 works including cinematograph films, any patent, trade
mark, design or model, plan, secret formula or process, or for information
concerning industrial, commercial or scientific experience.
4. The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner
of the royalties, being a resident of a Contracting State, carries on business in the
other Contracting State in which the royalties arise, through a permanent
establishment situated therein, or performs in that other 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 sub-division, a local authority or a resident of that State.
Where, however, the person paying the royalties, whether he is a resident of a
Contracting State or not, has in a Contracting State a permanent establishment or a
fixed base in connection with which the 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 laws of each Contracting State, due
regard being had to the other provisions of this Agreement.
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 or the principal assets of
the company are situated.
3. Income or gains from the alienation of movable property forming part of the
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA [ S.L.123.45 11
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 income or
gains from the alienation of such a permanent establishment (alone or with the whole
enterprise) or of such fixed base, may be taxed in the other State.
4. Income or gains from the alienation of ships or aircraft operated in
international traffic by an enterprise of a Contracting State, or movable property
pertaining to the operation of such ships or aircraft shall be taxable only in that
State.
5. Income or gains from the alienation of any property other than that 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. 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 which 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; or
( c ) if the net income for his services in the other Contracting State is
derived from residents of that State and exceeds in the currency of that
State the equivalent of 20,000 United States dollars during the fiscal
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, 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
12 [ S.L.123.45
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA
( 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 or aircraft operated in
international traffic by an enterprise of a Contracting State may be taxed in that
State.
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.
A RTICLE 17
Entertainers and Sportsmen
1. Notwithstanding the provisions of Articles 7, 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.
ARTICLE 18
Pensions and Annuities
1. Subject to the provisions of paragraph 2 of Article 19, pensions and similar
remuneration and annuities arising in a Contracting State and paid to a resident of
the other Contracting State may be taxed in the first-mentioned State.
2. Notwithstanding the provisions of paragraph 1, pensions paid and other
payments made under the social security legislation of a Contracting State shall be
taxable only in that State.
ARTICLE 19
Government Service
1. ( a ) Salaries, wages and other similar remuneration, other than a 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 salaries, wages and 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:
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA [ S.L.123.45 13
(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 and 18 shall apply to salaries, wages and
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.
4. Salaries, wages and similar remuneration paid under a development
assistance programme of a Contracting State, out of funds exclusively supplied by
that State to a specialist or volunteer seconded to the other Contracting State with the
consent of that other State, shall be deemed to have been paid by the first-mentioned
State and shall be taxable only in that State.
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 Agreement 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.
CHAPTER IV 
ELIMINATION OF DOUBLE TAXATION
ARTICLE 22
Elimination of Double Taxation
1. In the case of Malta, double taxation shall be eliminated as follows:
14 [ S.L.123.45
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA
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 Agreement, there is included in a Malta assessment income from sources
within South Africa, the South African tax on such income shall be allowed as a
credit against the relative Malta tax payable thereon.
2. In the case of South Africa, double taxation shall be eliminated as follows:
Where South African tax is, in accordance with the provisions of this Agreement,
paid by South African residents in respect of income which, in terms of the
provisions of this Agreement, is taxable in Malta, Malta tax on such income shall be
deducted from the South African tax but in an amount not exceeding that proportion
of the South African tax which such items of income bear to the entire income.
3. Where the Agreement 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. The Nationals of a Contracting State shall not be subjected in the other
Contracting State to any taxation or any requirement connected therewith, which is
other or more burdensome than the taxation and connected requirements to which
nationals of that other 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. 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
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-
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA [ S.L.123.45 15
mentioned State are or may be subjected.
5. In this Article the term "taxation'' means taxes which are the subject of this
Agreement.
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 Agreement, 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 this Agreement.
2. The competent authority shall endeavour, if the objection appears to it to be
justified and if it is not itself able to arrive at a satisfactory solution, to resolve the
case by mutual agreement with the competent authority of the other Contracting
State, with a view to the avoidance of taxation which is not in accordance with the
Agreement. 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 Agreement. They may also consult together for
the elimination of double taxation in cases not provided for in the Agreement.
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.
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 Agreement or of
the domestic laws of the Contracting States concerning taxes covered by the
Agreement, insofar as the taxation thereunder is not contrary to the Agreement. The
exchange of information is not restricted by Article I. 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 this Agreement. Such
persons or authorities shall use the information only for such purposes. They may
disclose the information in public court proceedings or in judicial decisions.
2. In no case shall the provisions of paragraph 1 be construed so as to impose
on a Contracting State the obligation:
( a ) to carry out administrative measures at variance with the laws and
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
16 [ S.L.123.45
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA
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
Diplomatic Agents and Consular Officers
Nothing in this Agreement shall affect the fiscal privileges of diplomatic agents or
consular officers under the general rules of international law or under the provisions
of special agreements.
CHAPTER VI
FINAL PROVISIONS
ARTICLE 27
Entry into Force
1. Each of the Contracting States shall notify to the other the completion of the
procedures required by its law for the bringing into force of this Agreement. The
Agreement shall enter into force on the date of the later of these notifications.
2.  The provisions of this Agreement shall apply:
( a ) in Malta in respect of taxes which are levied for any year of assessment
beginning on or after 1 January in the second calendar year immediately
following the year in which the Agreement enters into force; and
( b ) in South Africa,
(i) with regard to taxes withheld at source, in respect of amounts paid
or credited on or after the first day of January next following the
date upon which this Agreement enters into force; and
(ii) with regard to other taxes, in respect of income of taxable years
beginning on or after the first day of January next following the
date upon which this Agreement enters into force.
ARTICLE 28
Termination
This Agreement shall remain in force until terminated by a Contracting State.
Either Contracting State may terminate the Agreement through the diplomatic
channel, 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 Agreement shall cease to have effect:
( a ) in Malta:
in respect of taxes which are levied for any year of assessment
beginning on or after 1 January of the second calendar year next
following the year in which such notice is given;
( b ) in South Africa:
(i) with regard to taxes withheld at source, in respect of amounts paid
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH SOUTH AFRICA [ S.L.123.45 17
or credited after the end of the calendar year in which such notice
is given; and
(ii) with regard to other taxes, in respect of income derived during
any taxable year beginning after the end of the calendar year in
which such notice is given.
IN WITNESS WHEREOF the undersigned, being duly authorised thereto, have
signed this Agreement.
DONE in duplicate at Rome this 16th day of May, 1997 in the English language.
PROTOCOL
At the moment of signing the Agreement between the Government of Malta and
the Government of South Africa 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 provisions shall form an integral part of the Agreement:
Concerning Article 10 it is understood that dividends arising outside South Africa
are not subjected to South African tax. Should there be any change in this system, or
any change in the imputation system presently applied in Malta, the Contracting
States will reconsider the provisions of that Article.
IN WITNESS WHEREOF, the undersigned, duly authorised thereto by their
respective Governments, have signed this Protocol.
DONE in duplicate at Rome this 16th day of May, 1997 in the English language.
HENRY DE GABRIELE 
FOR THE GOVERNMENT OF 
MALTA
DR. KHORSHED GINWALA 
FOR THE GOVERNMENT OF 
SOUTH AFRICA
HENRY DE GABRIELE 
FOR THE GOVERNMENT OF 
MALTA
DR. KHORSHED GINWALA 
FOR THE GOVERNMENT OF 
SOUTH AFRICA
