Tax Agreement Between Australia And New Zealand

2.220 This article provides general protection against excessive interest payments where there is a special relationship between persons linked to a loan transaction – limiting the amount on which the tax requirement stagnates from 10% of the 10% tax rate application in the source country to an amount of interest that could have been agreed if the parties to the loan contract had to do each other at the height of the hand. Any excess interest remains taxable under each country`s national law, but is subject to the other articles of the convention. [Article 11, paragraph 8] The text of the new double taxation agreement is available at www.taxpolicy.ird.govt.nz Article 1, paragraph 2, DBA, which addresses issues relating to income collected by or through companies that are tax-transparent with respect to these revenues (. B, for example, certain partnerships, trusts and hybrid companies). This provision applies when one or more tax-transparent units are interposed between the income and the member who is taxable, between the income and the member. The application of the DBA is determined on the basis of the final taxable member`s place of residence to the income, profits and profits of the tax-transparent unit. The agreement provides for consultations between the two tax authorities and a mechanism for other forms of dispute resolution, including mandatory dispute resolution [Article 25]. In the meantime, the two countries ratified the agreement and exchanged diplomatic notes. 2.304 This article contains rules on the distribution of tax duties between the two countries with respect to income items that are not covered by the previous articles of the Convention. The scope of the article is not limited to income items that are generated in one country, but also extends to income from sources in a third country. 2.243 If there is a special relationship between the payer and the actual beneficiary of the royalties, the 5% withholding tax applies only to the extent that the royalties are not excessively high.

Any excess royalties remain taxable under each country`s national law, but are subject to the other articles of the convention. 4.35 Article 8 provides for consultations between the competent authorities of the two countries to resolve disputes over transfer pricing adjustments that would have been made in accordance with the arm length principle.