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Act No. 22 of 1995 as made
An Act to amend the Income Tax (International Agreements) Act 1953, and for related purposes
Administered by: Treasury
Date of Assent 29 Mar 1995
Date of repeal 10 Mar 2016
Repealed by Amending Acts 1990 to 1999 Repeal Act 2016
 

INCOME TAX (INTERNATIONAL AGREEMENTS) AMENDMENT ACT 1995 No. 22, 1995

Making Information
- Assented to 29 March 1995

INCOME TAX (INTERNATIONAL AGREEMENTS) AMENDMENT ACT 1995 No. 22 of 1995 - LONG TITLE

An Act to amend the Income Tax (International Agreements) Act
1953, and for related purposes

INCOME TAX (INTERNATIONAL AGREEMENTS) AMENDMENT ACT 1995 No. 22 of 1995 - SECT 1
Short title

1. This Act may be cited as the Income Tax (International Agreements) Amendment Act 1995.


(Minister's second reading speech made in -
House of Representatives on 28 February 1995
Senate on 1 March 1995)

INCOME TAX (INTERNATIONAL AGREEMENTS) AMENDMENT ACT 1995 No. 22 of 1995 - SECT 2
Commencement

2. This Act commences on the day on which it receives the Royal Assent.

INCOME TAX (INTERNATIONAL AGREEMENTS) AMENDMENT ACT 1995 No. 22 of 1995 - SECT 3
Schedule

3. The Acts specified in the Schedule to this Act are amended in accordance with the applicable items in the Schedule, and item 14 in the Schedule has effect according to its terms.
AMENDMENTS RELATING TO TAX AGREEMENTS WITH NEW ZEALAND
PART 1 - INCOME TAX (INTERNATIONAL AGREEMENTS) ACT 1953
1. Title:
After "Income" insert "and Fringe Benefits".
2. Section 1:
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
3. Subsection 3(1) (paragraph (c) of the definition of "agreement"):
Omit "previous", substitute "1960".
4. Subsection 3(1) (definition of "agreement"):
Insert:
"(ca) the 1972 New Zealand agreement;".
5. Subsection 3(1) (definition of "Australian tax"):
Omit the definition, substitute:
" 'Australian tax' means:
(a) income tax imposed as such by an Act; or
(b) fringe benefits tax imposed by the Fringe Benefits Tax Act 1986;".
6. Subsection 3(1) (definition of "the previous New Zealand
agreement"):
Omit the definition.
7. Subsection 3(1) (after the definition of "the Netherlands
agreement"):
Insert the following definitions:
" 'the 1960 New Zealand agreement' means the Agreement between the
Government of Australia and the Government of New Zealand for the
avoidance of double taxation and the prevention of fiscal evasion with
respect to taxes on income that was signed at Canberra on 12 May 1960;
'the 1972 New Zealand agreement' means the Agreement between the
Government of Australia and the Government of New Zealand for the
avoidance of double taxation and the prevention of fiscal evasion with
respect to taxes on income that was signed at Melbourne on 8 November
1972;".
8. After section 4:
Insert:
Incorporation of Fringe Benefits Tax Assessment Act
"4AA.(1) Subject to subsection (2), the Fringe Benefits Tax Assessment
Act 1986 is incorporated and is to be read as one with this Act.
"(2) The provisions of this Act have effect in spite of anything
inconsistent with those provisions contained in the Fringe Benefits Tax
Assessment Act 1986 (other than section 67 of that Act).".
Note: The heading to section 4 is altered by adding at the end "of
Assessment Act".
9. Before subsection 6B(1):
Insert:
"(1A) Subject to this Act, on and after the date of entry into force of
the New Zealand agreement, the provisions of the agreement, so far as
those provisions affect Australian tax, have the force of law according
to their tenor.".
10. Subsection 6B(1):
Omit "the New Zealand agreement, so far as those provisions affect
Australian tax, have, and shall be deemed to have had,", substitute "the
1972 New Zealand agreement, so far as those provisions affect Australian
tax, continue to have".
11. Subsection 6B(2):
Omit "the New Zealand agreement have, and shall be deemed to have had,",

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substitute "the 1972 New Zealand agreement continue to have".
12. Subsection 6B(3):
Omit "the previous New Zealand agreement", substitute "the 1960 New
Zealand agreement".
13. Schedule 4:
Repeal the Schedule, substitute:
"SCHEDULE 4 Section 3
AGREEMENT BETWEEN THE GOVERNMENT OF AUSTRALIA AND
THE GOVERNMENT OF NEW ZEALAND FOR THE AVOIDANCE OF DOUBLE
TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO
TAXES ON INCOME THE GOVERNMENT OF AUSTRALIA AND THE GOVERNMENT
OF NEW ZEALAND
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:
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 New Zealand:
the income tax and the fringe benefit tax;
(b) In Australia:
the income tax, the resource rent tax in respect of offshore projects
relating to exploration for or exploitation of petroleum resources and
the fringe benefits tax imposed under the federal law of Australia.
2. This Agreement shall apply also to any identical or substantially
similar taxes which are imposed under the federal law of Australia or the
law of New Zealand after the date of signature of this Agreement in
addition to, or in place of, the existing taxes. The competent
authorities of the Contracting States shall notify each other within a
reasonable period of time of any significant changes which have been made
in the law of their respective States relating to the taxes to which this
Agreement applies.
Article 3
General definitions
1. For the purposes of this Agreement, unless the context otherwise
requires:
(a) (i) the term "New Zealand" means the territory of New Zealand but
does not include Tokelau or the Associated Self Governing States of the
Cook Islands and Niue; it also includes any area beyond the territorial
sea which by New Zealand legislation and in accordance with international
law has been, or may hereafter be, designated as an area in which the
rights of New Zealand with respect to natural resources may be exercised;
(ii) the term "Australia", when used in a geographical sense, excludes
all external territories other than:
(A) the Territory of Norfolk Island;
(B) the Territory of Christmas Island;
(C) the Territory of Cocos (Keeling) Islands;
(D) the Territory of Ashmore and Cartier Islands;
(E) the Territory of Heard Island and McDonald Islands; and
(F) the Coral Sea Islands Territory, and includes any area adjacent to
the territorial limits of Australia (including the Territories specified
in this subparagraph) in respect of which there is for the time being in
force, consistently with international law, a law of Australia dealing
with the exploration for or exploitation of any of the natural resources
of the seabed and subsoil of the continental shelf;
(b) the term "Australian tax" means tax imposed by Australia, being tax
to which this Agreement applies by virtue of Article 2;
(c) the term "company" means any body corporate or any entity which is
treated as a company or body corporate for tax purposes;
(d) the term "competent authority" means:
(i) in the case of New Zealand, the Commissioner of Inland Revenue or an
authorised representative of the Commissioner; and
(ii) in the case of Australia, the Commissioner of Taxation or an
authorised representative of the Commissioner;
(e) the terms "a Contracting State" and "other Contracting State" mean
New Zealand or Australia, the Governments of which have concluded this
Agreement, as the context requires;
(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 from a place or between places in
the other Contracting State;
(h) the term "New Zealand tax" means tax imposed by New Zealand, being

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tax to which this Agreement applies by virtue of Article 2;
(i) the term "paid", in relation to any amount, includes distributed
(whether in cash or other property), credited or dealt with on behalf of
a person or at that person's direction; and the terms "pay", "payable"
and "payment" have corresponding meanings;
(j) the term "person" includes an individual, a company and any other
body of persons;
(k) the term "tax" means New Zealand tax or Australian tax, as the
context requires, but does not include any penalty or interest imposed
under the law of either Contracting State relating to its tax.
2. For the purposes of Articles 10, 11 and 12, a trustee subject to tax
in a Contracting State in respect of dividends, interest or royalties
shall be deemed to be beneficially entitled to such dividends, interest
or royalties.
3. In the application of this Agreement by a Contracting State, any
term not defined in this Agreement shall, unless the context otherwise
requires, have the meaning which it has under the law of that State from
time to time in force relating to the taxes to which this Agreement
applies.
Article 4
Residence
1. For the purposes of this Agreement, a person is a resident of a
Contracting State:
(a) in the case of New Zealand, if the person is resident in New Zealand
for the purposes of New Zealand tax; and
(b) in the case of Australia, if the person is a resident of Australia
for the purposes of Australian tax.
2. A person is not a resident of a Contracting State for the purposes
of this Agreement if the person is liable to tax in that State in respect
only of income from sources in that State.
3. Where by reason of the preceding provisions of this Article a
person, being an individual, is a resident of both Contracting States,
then the status of the person shall be determined in accordance with the
following rules:
(a) the person shall be deemed to be a resident solely of the State in
which a permanent home is available to the person; if a permanent home is
available to the person in both States, the person shall be deemed to be
a resident solely of the State with which the person's personal and
economic relations are closer;
(b) if the person is unable to be deemed to be a resident solely of a
State in accordance with the provisions of subparagraph (a), the person
shall be deemed to be a resident solely of the State in which the person
has an habitual abode;
(c) if the person has an habitual abode in both States or in neither of
them, the person shall be deemed to be a resident solely of the State of
which the person is a citizen.
4. Where by reason of the provisions of paragraphs 1 and 2 a person
other than an individual is a resident of both Contracting States then it
shall be deemed to be a resident solely of the Contracting State in which
its place of effective management is situated.

Article 5
Permanent establishment
1. For the purposes 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;
(f) a mine, an oil or gas well, a quarry or any other place of extraction
of natural resources; and
(g) an agricultural, pastoral or forestry property.
3. A building site, or a construction, installation or assembly project
constitutes a permanent establishment if it lasts for more than 6 months.
4. An enterprise shall be deemed to have a permanent establishment in a
Contracting State and to carry on business through that permanent
establishment if:
(a) it carries on supervisory activities in that State for more than 6
months in connection with a building site or a construction, installation
or assembly project which is being undertaken in that State; or
(b) in that State it carries on activities which consist of, or which are
connected with, the exploration for or exploitation of natural resources
situated in that State; or
(c) substantial equipment is being used in that State by, for or under
contract with the enterprise; or
(d) it performs in that State any operations for the felling, removal or
other exploitation of standing timber.

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5. For the purposes of determining the duration of activities under
paragraph 3 and subparagraph 4(a), the period during which activities are
carried on in a Contracting State by an enterprise associated with
another enterprise shall be aggregated with the period during which
activities are carried on by the enterprise with which it is associated
if the firstmentioned activities are connected with the activities
carried on in that State by the lastmentioned enterprise, provided that
any period during which two or more associated enterprises are carrying
on concurrent activities is counted only once. An enterprise
shall be deemed to be associated with another enterprise if one is
controlled directly or indirectly by the other, or if both are controlled
directly or indirectly by a third person or persons.
6. An enterprise shall not be deemed to have a "permanent
establishment" merely by reason of:
(a) the use of facilities solely for the purpose of storage, display or
delivery of goods or merchandise belonging to the enterprise; or
(b) the maintenance of a stock of goods or merchandise belonging to the
enterprise solely for the purpose of storage, display or delivery; or
(c) the maintenance of a stock of goods or merchandise belonging to the
enterprise solely for the purpose of processing by another enterprise; or
(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; or
(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, such as advertising or scientific research.
7. Notwithstanding the provisions of paragraphs 1 and 2, a person
acting in a Contracting State on behalf of an enterprise of the other
Contracting State - other than an agent of an independent status to whom
paragraph 8 applies-shall be deemed to be a permanent establishment of
that enterprise in the firstmentioned State if:
(a) the person has and habitually exercises in the firstmentioned State
an authority to conclude contracts on behalf of that enterprise, unless
the activities of that person are limited to those described in paragraph
6 and, 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; or
(b) in so acting, the person manufactures or processes in that State for
the enterprise goods or merchandise belonging to that enterprise.
8. 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 person who is a broker,
general commission agent or any other agent of an independent status and
is acting in the ordinary course of the person's business as such a
broker or agent.
9. 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 make either company a permanent establishment of the other.
10. The principles set forth in the preceding paragraphs of this
Article shall be applied in determining for the purposes of paragraph 5
of Article 11 and paragraph 5 of Article 12 whether there is a permanent
establishment outside both Contracting States, and whether an enterprise,
not being an enterprise of a Contracting State, has a permanent
establishment in a Contracting State.
Article 6
Income from real property
1. Income derived by a resident of a Contracting State from real
property situated in the other Contracting State may be taxed in that
other State.
2. The term "real property" shall have the meaning which it has under
the
law of the Contracting State in which that property is situated and shall
in any case include:
(a) a lease of land and any other interest in or over land, whether that
land is improved or not;
(b) a right to explore for or exploit mineral, oil or gas deposits, or
other natural resources;
(c) a right to receive variable or fixed payments either:
(i) as consideration for or in respect of the exploitation of, or
(ii) for the right to explore for or exploit, mineral, oil or gas
deposits, or other natural resources.
3. The provisions of paragraph 1 shall apply to income derived from the
direct use, letting, or use in any other form of real property.
4. Any interest or right referred to in paragraph 2 shall be regarded
as situated where the land, mineral, oil or gas deposits, quarries or
natural resources, as the case may be, are situated or where the
exploration or exploitation may take place.
5. The provisions of paragraphs 1, 3 and 4 shall also apply to income

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from real property of an enterprise and to income from real 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 in that
other State. If the enterprise carries on business in that manner, 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 in that other State, 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 enterprises with which it deals.
3. In the determination of the profits of a permanent establishment,
there shall be allowed as deductions expenses of the enterprise which are
incurred for the purposes of the 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. However, no deduction is allowable in respect of
expenses which are not deductible under the law of the Contracting State
in which the permanent establishment is situated.
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. Nothing in this Article shall affect the application of any law of a
Contracting State relating to the determination of the tax liability of a
person in cases where the information available to the competent
authority of that State is inadequate to determine the profits to be
attributed to a permanent establishment, provided that that law shall be
applied, so far as the information available to the competent authority
permits, consistently with the principles of this Article.
6. For the purposes of the preceding paragraphs of this Article, 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:
(a) a resident of a Contracting State is beneficially entitled, whether
directly or through one or more interposed trusts, to a share of the
business profits of an enterprise carried on in the other Contracting
State by the trustee of a trust other than a trust which is treated as a
company for tax purposes; and
(b) in relation to that enterprise, that trustee would, in accordance
with the principles of Article 5, have a permanent establishment in that
other State, the enterprise carried on by the trustee shall be deemed to
be a business carried on in the other State by that resident through a
permanent establishment situated in that other State and that share of
business profits shall be attributed to that permanent establishment.
8. Where profits include items of income or gains 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.
9. Nothing in this Article shall affect the operation of any law of a
Contracting State relating to tax imposed on any income, profits or gains
from the business of any form of insurance. Provided that if the relevant
law in force in either Contracting State at the date of signature of this
Agreement is varied (otherwise than in minor respects so as not to affect
its general character) the Contracting States shall consult each other
with a view to agreeing to any amendment of this paragraph that may be
appropriate.
Article 8
Ships and aircraft
1. Profits from ship or aircraft operations derived by a resident of a
Contracting State shall be taxable only in that State.
2. Notwithstanding the provisions of paragraph 1, such profits may be
taxed in the other Contracting State where they are profits from ship or
aircraft operations confined solely to places in that other State.
3. The provisions of paragraphs 1 and 2 shall apply in relation to the
share of the profits from ship or aircraft operations derived by a
resident of a Contracting State through participation in a pool service,
in a joint business or operating organisation or in an international
operating agency.
4. For the purposes of this Article, profits derived from the carriage
by ships or aircraft of passengers, livestock, mail, goods or merchandise
which are shipped in a Contracting State for discharge at a place in that
State shall be treated as profits from ship or aircraft operations

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confined solely to places in that State.

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 operate between the two enterprises in their commercial or
financial relations which differ from those which might be expected
to operate between independent enterprises dealing wholly independently
with one another, then any profits which, but for those conditions, might
have been expected to accrue 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. Nothing in this Article shall affect the application of any law of a
Contracting State relating to the determination of the tax liability of a
person, including determinations in cases where the information available
to the competent authority of that State is inadequate to determine the
income to be attributed to an enterprise, provided that that law shall be
applied, so far as it is practicable to do so, consistently with the
principles of this Article.
3. Where profits on which an enterprise of a Contracting State has been
charged to tax in that State are also included, by virtue of paragraph 1
or 2, in the profits of an enterprise of the other Contracting State and
charged to tax in that other State, and the profits so included are
profits which might have been expected to have accrued to that enterprise
of the other State if the conditions operative between the enterprises
had been those which might have been expected to have operated between
independent enterprises dealing wholly independently with one another,
then the firstmentioned State shall make an appropriate adjustment to the
amount of tax charged on those profits in the firstmentioned State. In
determining such an adjustment, due regard shall be had to the other
provisions of this Agreement and for this purpose 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 for the purposes of its tax, being dividends to which a resident of
the other Contracting State is beneficially entitled, may be taxed in
that other State.
2. Those dividends may also be taxed in the Contracting State of which
the company paying the dividends is a resident for the purposes of its
tax, and according to the law of that State, but the tax so charged shall
not exceed 15 per cent of the gross amount of the dividends. Provided
that any deemed dividend arising from the business of life insurance
consequent upon an election made and approved under section 204M of the
Income Tax Act 1976 of New Zealand, or any legislation enacted in
substitution for that section, shall be taxed at a rate not exceeding 5
per cent of the gross amount of such dividend.
3. The term "dividends" in this Article means income from shares and
other income assimilated to income from shares by the law, relating to
tax, of the Contracting State of which the company making the payment is
a resident for the purposes of its tax.
4. The provisions of paragraph 2 shall not apply if the person
beneficially entitled to 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 in that other State, or performs in that other
State independent personal services from a fixed base situated in that
other State, and the holding in respect of which the dividends are paid
is effectively connected with that permanent establishment or fixed base.
In that case, the provisions of Article 7 or 14, as the case may be,
shall apply.
5. Dividends paid by a company which is a resident of a Contracting
State, being dividends to which a person who is not a resident of the
other Contracting State is beneficially entitled, shall be exempt from
tax in that other State except in so far as the holding in respect of
which the dividends are paid is effectively connected with a permanent
establishment or fixed base situated in that other State. This paragraph
shall not apply in relation to dividends paid by any company which is a
resident of Australia for the purposes of Australian tax and which is
also resident in New Zealand for the purposes of New Zealand tax.
Article 11
Interest
1. Interest arising in a Contracting State, being interest to which a
resident of the other Contracting State is beneficially entitled, may be

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taxed in that other State.
2. That interest may be taxed in the Contracting State in which it
arises, and according to the law of that State, but the tax so charged
shall not exceed 10 per cent of the gross amount of the interest.
3. The term "interest" in this Article includes interest on
indebtedness of every kind, whether or not secured by mortgage and
whether or not carrying a right to participate in profits, and in
particular, interest from government securities and income from bonds or
debentures, including premiums and prizes attaching to such bonds or
debentures, as well as all other income assimilated to income from money
lent by the law, relating to tax, of the Contracting State in which the
income arises, but does not include any income which is treated as a
dividend under Article 10.
4. The provisions of paragraph 2 shall not apply if the person
beneficially entitled to 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 in that other
State, or performs in that other State independent personal services from
a fixed base situated in that other State, and the indebtedness in
respect of which the interest is paid is effectively connected with that
permanent establishment or fixed base. In that case the provisions of
Article 7 or 14, as the case may be, shall apply.
5. Interest shall be deemed to arise in a Contracting State when the
payer is that State itself or a political subdivision or a local
authority of that State, or a person who is a resident of that State for
the purposes of its tax. Where, however, the person paying the interest,
whether the person is a resident of a Contracting State or not, has in a
Contracting State or outside both Contracting States a permanent
establishment or fixed base in connection with which the indebtedness on
which the interest is paid was incurred, and that interest is deductible
in determining the income, profits or gains attributable to that
permanent establishment or fixed base, then the interest 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
person beneficially entitled to the interest, or between both of them and
some other person, the amount of the interest, having regard to the
indebtedness for which it is paid, exceeds the amount which might have
been expected to have been agreed upon in the absence of that
relationship by the payer and the person beneficially entitled, the
provisions of this Article shall apply only to the lastmentioned amount.
In that case the excess part of the amount of the interest paid shall
remain taxable according to the law, relating to tax, of each Contracting
State, subject to the other provisions of this Agreement.
Article 12
Royalties
1. Royalties arising in a Contracting State, being royalties to which a
resident of the other Contracting State is beneficially entitled, may be
taxed in that other State.
2. Those royalties may be taxed in the Contracting State in which they
arise, and according to the law of that State, but the tax so charged
shall not exceed 10 per cent of the gross amount of the royalties.
3. The term "royalties" in this Article means payments of any kind,
whether periodical or not, and however described or computed, to the
extent to which they are made as consideration for:
(a) the use of, or the right to use, any copyright, patent, trademark,
design or model, plan, secret formula or process, or other like property
or right; or
(b) the use of, or the right to use, any industrial, scientific or
commercial equipment; or
(c) the supply of scientific, technical, industrial or commercial
knowledge or information; or
(d) the supply of any assistance that is ancillary and subsidiary to, and
is furnished as a means of enabling the application or enjoyment of, any
such property or right as is mentioned in subparagraph (a), any such
equipment as is mentioned in subparagraph (b) or any such knowledge or
information as is mentioned in subparagraph (c); or
(e) the use of, or the right to use, any:
(i) motion picture film; or
(ii) film or videotape for use in connection with television; or
(iii) tape for use in connection with radio broadcasting; or
(f) the reception of, or the right to receive, visual images or sounds,
or both, transmitted to the public by:
(i) satellite; or
(ii) cable, optic fibre or similar technology; or
(g) the use in connection with television broadcasting or radio
broadcasting, or the right to use in connection with television
broadcasting or radio broadcasting, visual images or sounds, or both,
transmitted by:
(i) satellite; or

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(ii) cable, optic fibre or similar technology; or
(h) total or partial forbearance in respect of the use or supply of any
property or right referred to in this paragraph.
4. The provisions of paragraph 2 shall not apply if the person
beneficially entitled to 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 in that other
State, or performs in that other State independent personal services from
a fixed base situated in that other State, and the property or right in
respect of which the royalties are paid is effectively connected with
that permanent establishment or fixed base. In that case the provisions
of Article 7 or 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 or a political subdivision or local authority
of that State or a person who is a resident of that State for the
purposes of its tax. Where, however, the person paying the royalties,
whether the person is a resident of a Contracting State or not, has in a
Contracting State or outside both Contracting States a permanent
establishment or fixed base in connection with which the liability to pay
the royalties was incurred, and the royalties are deductible in
determining the income, profits or gains attributable to that permanent
establishment or fixed base, then the 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
person beneficially entitled to the royalties, or between both of them
and some other person, the amount of the royalties, having regard to what
they are paid for, exceeds the amount which might have been expected to
have been agreed upon in the absence of that relationship by the payer
and the person beneficially entitled, the provisions of this Article
shall apply only to the lastmentioned amount. In that case the excess
part of the amount of the royalties paid shall remain taxable according
to the law, relating to tax, of each Contracting State, subject to the
other provisions of this Agreement.
Article 13
Alienation of property
1. Income, profits or gains derived by a resident of a Contracting
State from the alienation of real property situated in the other
Contracting State may be taxed in that other State.

2. Income, profits or gains from the alienation of property, other than
real property, forming part of the business property of a permanent
establishment which an enterprise of a Contracting State has in the other
Contracting State or 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 income, profits or
gains from the alienation of that permanent establishment (alone or with
the whole enterprise) or of that fixed base, may be taxed in that other
State.
3. Income, profits or gains derived by a resident of a Contracting
State from the alienation of shares or comparable interests in a company,
the assets of which consist wholly or principally of real property
situated in the other Contracting State, may be taxed in that other
State.
4. Income, profits or gains from the alienation of ships or aircraft
operated in international traffic, or of property (other than real
property) pertaining to the operation of those ships or aircraft, shall
be taxable only in the Contracting State in which the enterprise
alienating such ships, aircraft or other property is a resident.
5. Nothing in this Agreement affects the application of a law of a
Contracting State relating to the taxation of gains of a capital nature
derived from the alienation of any property other than that to which any
of the preceding paragraphs of this Article apply.
6. In this Article, the term "real property" has the same meaning as it
has in Article 6.
7. For the purposes of this Article, the situation of real property
shall be determined in accordance with paragraph 4 of Article 6.
Article 14
Independent personal services
1. Income derived by an individual who is a resident of a Contracting
State in respect of professional services or other independent activities
shall be taxable only in that State unless such services are performed in
the other Contracting State and:
(a) the individual is present in the other State for a period or periods
exceeding in the aggregate 183 days in any 12 month period commencing or
ending in the year of income concerned; or
(b) a fixed base is regularly available to the individual in the other
State for the purpose of performing the individual's activities.
If the provisions of subparagraphs (a) or (b) are satisfied, the income
may be taxed in that other State but only so much of it as is
attributable to activities performed during such period or periods or

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from that fixed base.
2. The term "professional services" includes services performed in the
exercise of independent scientific, literary, artistic, educational or
teaching activities as well as in the performance of the independent
activities of physicians, lawyers, engineers, architects, dentists and
accountants.
Article 15
Dependent personal services
1. Subject to the provisions of Articles 16, 17, 19 and 20, salaries,
wages and other similar remuneration derived by an individual who is 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 from that exercise may be taxed in that other
State.
2. Notwithstanding the provisions of paragraph 1, remuneration derived
by an individual who is a resident of a Contracting State in respect of
an employment exercised in the other Contracting State shall be taxable
only in the firstmentioned State if:
(a) the recipient is present in that other State for a period or periods
not exceeding in the aggregate 183 days in any 12 month period commencing
or ending in the year of income concerned; and
(b) the remuneration is paid by, or on behalf of, an employer who is not
a resident of that other State; and
(c) the remuneration is not deductible in determining the taxable profits
of a permanent establishment or fixed base which the employer has in that
other State; and
(d) the remuneration is, or upon application of this Article will be,
subject to tax in the firstmentioned 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 a resident of a
Contracting State may be taxed in that State.
Article 16
Fringe benefits
1. Where, except for the application of this Article, a fringe benefit
would be subject to tax in both Contracting States the benefit will be
taxable solely in the Contracting State which has the sole or primary
taxing right in respect of the remuneration from the employment to which
the benefit relates.
2. For the purposes of this Article:
(a) "fringe benefit" includes a benefit provided to an employee or to an
associate of an employee by:
(i) an employer,
(ii) an associate of an employer, or
(iii) a person under an arrangement between that person and the
employer, associate of an employer, or another person in respect of the
employment of that employee, and includes an accommodation allowance or
housing benefit so provided;
(b) a Contracting State has a "primary taxing right" if it has a taxing
right under this Agreement in respect of the remuneration for the
relevant employment and the other Contracting State is required under
this Agreement to allow relief for any taxes imposed in respect of such
remuneration by the first Contracting State.
Article 17
Directors' fees
Directors' fees and similar payments derived by a resident of a
Contracting State in that person's 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 18
Entertainers
1. Notwithstanding the provisions of Articles 14 and 15, income derived
by entertainers (such as theatrical, motion picture, radio or television
artistes, musicians, athletes and other sportspersons) from their
personal activities as such may be taxed in the Contracting State in
which these activities are exercised.
2. Where income in respect of the personal activities of an entertainer
as such accrues not to that entertainer 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
are exercised.
3. The provisions of paragraphs 1 and 2 shall not apply to the income
of a sportsperson, being a resident of one or both of the Contracting
States for the purposes of its tax, derived as a member or associate of a
recognised team regularly playing in a league competition organised and
conducted solely in both Contracting States, except in respect of
performance as a member or associate of a national representative team of
either Contracting State.
4. The term "associate", as used in paragraph 3 includes any manager,

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coach, trainer, runner, physician, physiotherapist or other provider of a
like support service.
Article 19
Pensions and annuities
1. Pensions (including government pensions) and annuities paid to a
resident of a Contracting State shall be taxable only in that State.
2. The term "annuity" means a stated sum 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.
3. Any alimony or other maintenance payment arising in a Contracting
State and paid to a resident of the other Contracting State shall be
taxable only in the firstmentioned State.
Article 20
Government service
1. Remuneration (other than a pension or annuity) paid by the
Government of Australia, any Australian State, the Australian Capital
Territory or the Northern Territory, or any other Australian political
subdivision or local authority to an individual in respect of services
rendered to any such government in the discharge of governmental
functions shall be exempt from New Zealand tax if the individual is not a
resident of New Zealand for the purposes of New Zealand tax or is
resident in New Zealand for the purposes of New Zealand tax solely for
the purpose of rendering those services.
2. Remuneration (other than a pension or annuity) paid by the
Government of New Zealand, a New Zealand political subdivision or local
authority to an individual in respect of services rendered to that
Government, subdivision or authority in the discharge of governmental
functions shall be exempt from Australian tax if the individual is not a
resident of Australia for the purposes of Australian tax or is resident
in Australia for the purposes of Australian tax solely for the purpose of
rendering those services.
3. The provisions of paragraphs 1 and 2 shall not apply to remuneration
in respect of services rendered in connection with any trade or business
carried on by a government referred to in those paragraphs. In that case
the provisions of Article 15 or 17, as the case may be, shall apply.
Article 21
Students
Where a student, who is a resident of a Contracting State or who was a
resident of that State immediately before visiting the other Contracting
State and who is temporarily present in that other State solely for the
purpose of the student's education, receives payments from sources
outside that other State for the purpose of the student's maintenance or
education, those payments shall be exempt from tax in that other State.
Article 22
Other income
1. Items of income of a resident of a Contracting State, wherever
arising, not dealt with in the preceding Articles of this Agreement shall
be taxable only in that State except that if such income is derived from
sources within the other Contracting State, that income may also be taxed
in that other State.
2. The provisions of paragraph 1 shall not apply to income, other than
income from real property as defined in paragraph 2 of Article 6, derived
by a resident of a Contracting State where that income is effectively
connected with a permanent establishment or fixed base situated in the
other Contracting State. In that case the provisions of Article 7 or 14,
as the case may be, shall apply.
Article 23
Source of income
1. Income, profits or gains derived by a resident of a Contracting
State which, under any one or more of Articles 6 to 8, 10 to 20 and 22,
may be taxed in the other Contracting State shall, for the purposes of
the law of that other Contracting State relating to its tax, be deemed to
be income from sources in that other Contracting State.
2. Income, profits or gains derived by a resident of a Contracting
State which, under any one or more of Articles 6 to 8, 10 to 20 and 22,
may be taxed in the other Contracting State shall, for the purposes of
Article 24 and of the law of the firstmentioned Contracting State
relating to its tax, be deemed to be income from sources in the other
Contracting State.
Article 24
Elimination of double taxation
1. Subject to the provisions of the law of New Zealand from time to
time in force which relate to the allowance of a credit against New
Zealand income tax of tax paid in a country outside New Zealand (which
shall not affect the general principle of this Article), Australian tax
paid under the law of Australia and consistently with this Agreement,
whether directly or by deduction, in respect of income derived by a
resident of New Zealand from sources in Australia (excluding, in the case
of a dividend, tax paid in respect of the profits out of which the

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dividend is paid) shall be allowed as a credit against New Zealand tax
payable in respect of that income.

2. Subject to the provisions of the law of Australia from time to time
in force which relate to the allowance of a credit against Australian
income tax of tax paid in a country outside Australia (which shall not
affect the general principle of this Article), New Zealand tax paid under
the law of New Zealand and in accordance with this Agreement, whether
directly or by deduction, in respect of income derived by a person who is
a resident of Australia from sources in New Zealand (excluding, in the
case of a dividend, tax paid in respect of the profits out of which the
dividend is paid) shall be allowed as a credit against Australian income
tax payable in respect of that income.
Article 25
Mutual agreement procedure
1. Where a person who is a resident of a Contracting State considers
that the actions of one or both of the competent authorities of the
Contracting States result or will result for the person in taxation not
in accordance with the provisions of this Agreement, the person may,
irrespective of the remedies provided by the domestic law of the
Contracting States, present a case to the competent authority of the
Contracting State of which the person is a resident. The case must be
presented within three years from the first notification of the action
which results in taxation not in accordance with the provisions of this
Agreement.
2. The competent authority shall endeavour, if the claim appears to it
to be justified and if it is not itself able to arrive at an appropriate
solution, to resolve the case with the competent authority of the other
Contracting State, with a view to the avoidance of taxation not in
accordance with the provisions of this Agreement. The solution so 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 jointly
endeavour to resolve any difficulties or doubts arising as to the
interpretation or application of the provisions of this Agreement.
4. The competent authorities of the Contracting States may communicate
with each other directly for the purpose of giving effect to the
provisions of this Agreement.
Article 26
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 law of the Contracting States concerning the
taxes to which this Agreement applies insofar as the taxation under that
law is not contrary to this Agreement. The exchange of information is not
restricted by Article
1. Any information received by the competent authority of a Contracting
State shall be treated as secret in the same manner as information
obtained under the domestic law 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 to which this Agreement applies. Such persons or
authorities shall use the information only for such purposes.
2. In no case shall the provisions of paragraph 1 be construed so as to
impose on the competent authority of a Contracting State the obligation:
(a) to carry out administrative measures at variance with the law
or administrative practice of that or of the other Contracting State;
(b) to supply information which is not obtainable under the law or in the
normal course of the administration of that or of the other Contracting
State; or
(c) to supply information which would disclose any trade, business,
industrial, commercial or professional secret or trade process, or to
supply information the disclosure of which would be contrary to public
policy.
Article 27
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 international
agreements.
Article 28
Entry into force
1. This Agreement shall enter into force on the last date on which the
Contracting States exchange notes through the diplomatic channel
notifying each other that the last of such things has been done as is
necessary to give this Agreement the force of law in New Zealand and in
Australia, as the case may be, and,
in that event, this Agreement shall have effect:
(a) in New Zealand:
(i) in respect of withholding tax on income that is derived by a

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non-resident, in relation to income derived on or after 1 April next
following the date on which the Agreement enters into force;
(ii) in respect of other New Zealand tax, for any income year beginning
on or after 1 April next following the date on which the Agreement enters
into force;
(b) in Australia:
(i) in respect of withholding tax on income that is derived by a
non-resident, in relation to income derived on or after 1 April next
following the date on which the Agreement enters into force;
(ii) in respect of fringe benefits tax, in relation to fringe benefits
provided on or after 1 April next following the date on which the
Agreement enters into force;
(iii) in respect of other Australian tax, in relation to income, profits
or gains of any year of income beginning on or after 1 July next
following the date on which the Agreement enters into force.
2. The Agreement between the Government of the Commonwealth of
Australia and the Government of New Zealand signed at Melbourne on 8
November 1972 shall terminate and cease to have effect in relation to any
tax in respect of which this Agreement comes into effect in accordance
with paragraph 1.
Article 29
Termination
This Agreement shall continue in effect indefinitely, but either
Contracting State may, on or before 30 June in any calendar year
beginning after the expiration of 5 years from the date of its entry into
force, give to the other Contracting State through the diplomatic channel
written notice of termination and, in that event, this Agreement shall
cease to be effective:
(a) in New Zealand:
(i) in respect of withholding tax on income that is derived by a
non-resident, on or after 1 April in the calendar year next following
that in which the notice of termination is given;
(ii) in respect of other New Zealand tax, for any income year beginning
on or after 1 April in the calendar year next following that in which the
notice of termination is given;
(b) in Australia:
(i) in respect of withholding tax on income that is derived by a
non-resident, in relation to income derived on or after 1 April in the
calendar year next following that in which the notice of termination is
given;
(ii) in respect of fringe benefits tax, in relation to fringe benefits
provided on or after 1 April in the calendar year next following that in
which the notice of termination is given;
(iii) in respect of other Australian tax, in relation to income, profits
or gains of any year of income beginning on or after 1 July in the
calendar year next following that in which the notice of termination is
given.
IN WITNESS WHEREOF the undersigned, duly authorised thereto by their
respective Governments, have signed this Agreement.
DONE in duplicate at Melbourne this 27th day of January, One thousand
nine hundred and ninety-five in the English language.
FOR THE GOVERNMENT OF AUSTRALIA:
FOR THE GOVERNMENT OF NEW ZEALAND:
RALPH WILLIS
BILL BIRCH
".
14. Application
The amendment made by item 5 does not affect income tax and social
services contribution imposed before the commencement of that item.
PART 2 - OTHER ACTS
Division 1-Fringe Benefits Tax Assessment Act 1986
15. Subsection 67(12):
After "other than this section or" insert "in the International Tax
Agreements Act 1953 or".
Division 2-Income Tax Assessment Act 1936
16. Subparagraph 6AB(2)(a)(iv):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
17. Subsection 6AB(5):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
18. Subsection 6CA(1) (definition of "double tax agreement"):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
19. Section 102AAV:
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
20. Section 121K:
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
Note: The heading to section 121K is replaced by the heading "Application
of International Tax Agreements Act".
21. Subsection 170(14) (definition of "double taxation agreement"):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
22. Subsection 170(14) (definition of "the United Kingdom agreement"):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
23. Subsection 177B(1):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
24. Subparagraph 221AG(8)(a)(ii):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
25. Subsection 221AV(2):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
26. Subparagraph 221AY(6)(a)(ii):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
27. Subparagraph 221AZE(6)(a)(ii):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
28. Subparagraph 221AZP(1)(b)(i):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
29. Subsection 221YDC(1):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
30. Paragraph 225(2)(b):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
31. Paragraph 225(2)(c):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
32. Paragraph 225(2)(d):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
33. Section 317 (paragraph (a) of the definition of "double tax
agreement"):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
34. Section 388:
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
Division 3-Petroleum Resource Rent Tax Assessment Act 1987
35. Section 55:
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".
Division 4-Sex Discrimination Act 1984
36. Paragraph 40(2)(d):
Omit "Income Tax (International Agreements) Act 1953", substitute
"International Tax Agreements Act 1953".