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ARTICLE 6

 

1          Income from immovable property may be taxed in the Contracting State in which such property is situated.

 

2          The term “immovable property” shall be defined in accordance with 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, 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 paragraph 1 and 3 shall also apply to the income from immovable property of an enterprise.

 

 

ARTICLE 7

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 by taxed in that other State but only so much of them as is attributable to that permanent establishment.

 

2          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 the determination of the profits of a permanent establishment, there shall be allowed as deductions expenses which are incurred for the purposed 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          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.

 

5          Where profits include items of income which are dealt with separately in other Articles of this Agreement, then the provisions of those Articles shall not be affected by the provisions of this Article.

 

 

ARTICLE 8

1          Profits of an enterprise of a Contracting State from the operation of aircraft in international traffic shall be taxable only in that State.

 

2          If according to Article 7 and enterprise of a Contracting State operating ships in international traffic may be taxed in the other Contracting State the tax charged shall in that other State be reduced by an amount equal to 50 per cent thereof.

 

3          The provisions of paragraph 1 and 2 shall likewise apply to profits arising from participations in shipping or aircraft pools of any kind by such enterprises engaged in shipping or air transport.

 

 

ARTICLE 9

Where

            (a)        an enterprise of a Contracting State participated directly or

                         indirectly in the management,  control or capital of an

                         enterprise of the other Contracting State, or

            (b)        the same persons participate directly or indirectly in the

                         management, control or capital of an enterprise of a

                         Contracting State and an enterprise of the other Contracting

                         State,

            and in either case conditions are made or imposed between the two enterprises in their commercial or financial relations which differ from those which would be made between independent enterprises, then any profits which would, but for those conditions, have accrued to one of the enterprises, but by reason of those conditions, have not so accrued, may be included in the profits of that enterprise and taxed accordingly.

 

 

ARTICLE 10

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, but

            (a)        the Thai tax shall not exceed:

                        1.         20 per cent of the gross amount of the dividends if the

                                    company paying the dividends engages inan industrial

                                    undertaking or if the recipient of the dividends is a

                                    company which is a resident ofthe Federal Republic

                                    owning at least  25 per cent  of the voting shares the

                                    company paying the dividends;

                        2.         15 per cent of the gross amount of the dividends if the

                                     company paying the dividends engages in an

                                     industrial undertaking and the recipient of the

                                     dividends is a company which is a resident of the

                                     Federal Republic owning at least 25 per cent of the

                                     voting shares of the former company;

            (b)        the German tax shall not exceed:

                         1.         20 per cent of the gross amount of the dividends,

                                      unless sub-paragraph 2 applies;

                         2.         15 per cent of the gross amount of the dividends if the

                                      recipient of the dividends is a company which is a

                                      resident of Thailand owning at least 25 per cent of the

                                      voting shares of the company paying the dividends.

 

3          Notwithstanding the provisions of paragraph 2 the tax of a Contracting State on dividends paid by a company which is a resident of that State may exceed the rates provided for in that paragraph but shall not exceed 25 per cent of the gross amount of the dividends, if

            (a)        the corporation tax of that State on distributed profits is lower

                         than that on undistributed profits and the difference between

                         those two rates is 20 percentage points or more, and

            (b)        such dividends are paid by a company which is a resident of

                         that State to a company resident of the other State and which

                         owns at least 25 per cent of the voting share of the first-

                         mentioned company.

 

4          In this Article

            (a)        the term “dividends” means income from shares and

                         income from other corporate rights assimilated to income

                         from shares by the taxation law 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

                                                  shipbuilding,

                                     (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 purposes of this Article

                                     by the competent authority of Thailand.

 

5          The provisions of paragraphs 1 to 3 shall not apply if the recipient of the dividends, being a resident of a Contracting State, has in the other Contracting State, of which the company paying the dividends is a resident, a permanent  establishment with which the holding by virtue of which the dividends are paid is effectively connected, provided that under the law of that other State the dividends are taxed as part of the profits of the permanent establishment.

 

6          Where a company which is a resident of a Contracting State derives profits or income from the other Contracting State, that other State may not impose any tax on the dividends paid by the company to persons who are not residents of that other State, or subject the company’s undistributed profits to a tax on undistributed profits, even if the dividends paid or the undistributed profits consist wholly or partly of profits or income arising in such other  State.

 

 

 

Last updated: 08.12.2011