CHAPTER III
TAXATION OF INCOME ARTICLE 6
INCOME FROM IMMOVABLE PROPERTY 1. Income from immovable property (including income from agriculture of forestry) may be taxed in the Contracting State in which such property is situated. 2. For the purposes of this convention, the term immovable property shall have the meaning which it has under the laws of the Contracting State in which the property in question is situated. the term shall in any case include property accessory to immovable 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, mineral deposits, sources and other natural resources; ships, boats and aircraft shall not be regarded as immovable property. 3. The provisions of paragraph 1 shall apply to income derived from the direct use, letting, or use in any other form of immovable property. 4. The provisions of paragraphs 1 and 3 shall also apply to the income from immovable property of an enterprise and to income from immovable property used for the performance of independent personal services. ARTICLE 7
BUSINESS PROFITS 1. The income or profits of an enterprise of a contracting State shall be taxable only in that State unless the enterprise carries on business in the other Contracting State through a permanent establishment situated therein. If the enterprise carries on business as aforesaid, the income or profits of the enterprise may be taxed in the other State but only so much of them as is attributable to that permanent establishment. 2. Subject to the provisions of paragraph 3, where an enterprise of a contracting State carries on business in the other Contracting State through a permanent establishment situated therein, there shall in each Contracting State be attributed to that permanent establishment the income or profits which it might be expected to make if it were a distinct and separate enterprise engaged in the same or similar activities under the same or similar conditions and dealing wholly independently with the enterprise of which it is a permanent establishment. 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 a certain percentage of the gross receipts of the enterprise or 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 on such basis as may be customary; the method adopted shall, however, be such that result be in accordance with the principles contained in this Article. 5. No income or 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 income or 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. 8. The term profits as used in this Article includes the profits derived from a participation in a sleeping partnership (Stille Gesellschaft) created under Austrian law. ARTICLE 8
SHIPPING AND AIR TRANSPORT 1. Income derived by an enterprise of a Contracting State from the operation of aircraft in international traffic shall be taxable only in that State. 2. Income derived by an enterprise of a contracting State from the operation of ships in international traffic may be taxed in the other Contracting State, but the tax imposed in that other State shall be reduced by an amount equal to 50 per cent thereof. 3. The provisions of paragraphs 1 and 2 shall likewise apply in respect of participations in pools of any kind by enterprises engaged in shipping or air transport. ARTICLE 9
ASOCIATED ENTERPRISES Where (a) an enterprise of a Contracting State participates directly or indirectly in the
management, control or capital of an enterprise of the other contracting State, or (b) the same persons participated 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 imposes between the two enterprises in their commercial or financial relations which differ from those which would be made between independent enterprises, then any profits which would, but for those conditions, have accrued to one of the enterprises, but, by reason of those conditions, have not so accrued, may be included in the profits of that enterprise and taxed accordingly. ARTICLE 10
DIVIDENDS 1. Dividends paid by a company which is a resident of a Contracting State to a resident of the other. Contracting State may be taxed in that other State. 2. However, such dividends may be taxed in the Contracting State of which the company paying the dividends is a resident, and according to the law of that State, but, if the recipient of the dividends is a company, excluding a partnership, which holds directly at least 25 per cent of the capital of the former company, the tax so charged shall not exceed: (a) In the case of Thailand: (i) 15 per cent of the gross amount of the dividends if the company paying the dividends engages in an industrial undertaking, (ii) 20 per cent of the gross amount of the dividends in other cases; (b) In the case of Austria: 10 per cent of the gross amount of the dividends. This paragraph shall not affect the taxation of the company in respect of the profits out of which the dividends are paid. 3. (a) The term dividend as used in this Article means income from shares,
jouissance shares or jouissance rights, founders shares or other rights,
not being debt-claims participating in profits, as well as income from other
corporate rights which is subjected to the same taxation treatment as income
from shares by the laws of the State of which the company making the distribution is a resident. (b) The term industrial undertaking means: 1. any undertaking engaged in (i) manufacturing, assembling and processing, (ii) construction, civil engineering and ship-building, (iii) production of electricity, hydraulic power, gas or the supply of water, or (iv) agriculture, forestry and fishery and the carrying on of a plantation, and 2. any other undertaking entitled to the privileges accorded under the laws of
Thailand on the promotion of industrial investment, and 3. any other undertaking which may be declared to be an industrial
undertaking for the purpose of this Article by the competent authority of
Thailand. 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 companys undistributed profits to a tax on the companys undistributed profits, even if the dividends paid or the undistributed profits consist wholly or partly of profits or income arising in such other State. Nothing in this paragraph shall be construed as preventing either Contracting State from imposing income tax on disposal of profits according to the laws of the State. | 
