2. Table (Baumann/Gatterer/Schmidt)

DTT Austria/Czech Republic

DTT Austria/Czech Republic vs OECD-MC
Income and Capital Tax Treaty (2008)

Entry into force

22 March 2007

Effective Date

1 January 2008

Art 4 Resident

Art 4 of this Convention does not contain any special provisions in contrast to the OECD-MC.

Art 5 Permanent establishment

According to Art 5 para 2 of this Convention, the term „permanent establishment“ does not contain a place of management.
Art 5 para 3 lit a of this Convention foresees that a building site, a construction, assembly or installation project or supervisory activities in connection therewith constitutes a permanent establishment, but only if it lasts for a period of more than twelve months.
In addition to this, Art 5 para 3 lit b of this Convention provides that the term „permanent establishment“ likewise encompasses the furnishing of services, including consultancy or managerial services, by an enterprise or through employees or other personnel engaged for such purposes, but only where activities of that nature continue within the country for a period or periods exceeding in the aggregate six months within any twelve month period.

Art 6 Income from immovable property

Art 6 of this Convention does not contain any special provisions in contrast to the OECD-MC.

Art 7 Business profits

Art 7 of this Convention corresponds to Art 7 of the OECD-MC.

Art 8 Shipping and air transport

Art 8 of this Convention does not include a provision concerning profits derived from the operating of boats engaged in inland waterways transport.

Art 9 Associated enterprises

Art 9 does not contain – compared to the OECD-MC – the provision concerning an appropriate adjustment of the taxes charged in both States.

Art 10 Dividends

In contrast to the OECD-MC, Art 10 para 2 lit a of this Convention states that dividends may be taxed in the

Contracting State of which the legal entity paying the dividends is a resident and according to the laws of that State, but the withholding tax shall not exceed 10 per cent of the gross amount of the dividends.
Art 10 para 2 lit b, in contrast to the OECD-MC, provides that if the beneficial owner is a company which holds at least 10 per cent of the capital of the company paying the dividends, such dividends shall be taxable only in the state of residence of the beneficial owner.

Art 11 Interest

In contrast to the OECD-MC, Art 11 of this Convention does not foresee that interest may also be taxed in the Contracting State in which it arises.

Art 12 Royalties

In contrast to the OECD-MC, Art 12 para 2 of this Convention stipulates that royalties may also be taxed in the Contracting State in which they arise and according to the laws of that State, but if the beneficial owner is a resident of the other Contracting State, the withholding tax shall not exceed 5 per cent of the gross amount of the royalties. The competent authorities of the Contracting States shall by mutual agreement settle the mode of application of this limitation.

Art 13 Capital gains

Art 13 of this Convention does not contain a special provision concerning gains from the alienation of shares of a company, the property of which consists directly or indirectly principally of immovable property.

Art 14 Income from employment

In addition, Art 14 para 3 of this Convention includes a concretisation of the computation of the periods mentioned in para 2.
Apart from that, Art 14 of this Convention does not include any deviations from Art 15 of the OECD-MC.

Art 15 Directors' fees

Art 15 of this Convention corresponds to Art 16 of the OECD-MC, including special provisions concerning directors' fees.

Art 16 Artistes and sportsmen

Art 16 of this Convention does not contain any special provisions in contrast to the OECD-MC.

Art 20 Other income

Art 20 of this Convention – corresponding to Art 21 of the OECD-MC – states that income not dealt with in the other articles of the Convention shall be taxable only in the state of residence.

Art 22 Elimination of double taxation

According to Art 22 of this Convention, double taxation shall be avoided in Austria by the exemption method with progression and in the Czech Republic by the credit method.

Art 25 Exchange of information

Art 25 para 1 of this Convention stipulates that the competent authorities of the Contracting States shall exchange information concerning taxes of every kind and description imposed on behalf of the Contracting States, or of their political subdivisions or local authorities, insofar as the taxation thereunder is not contrary to the provisions of this Agreement.