Canada-Argentina Income Tax Convention Act, 1994 (S.C. 1994, c. 17, Part IV)

At the moment of signing the Convention for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital, this day concluded between Canada and the Argentine Republic, the undersigned have agreed upon the following provisions which shall be an integral part of the Convention.

• 1 With respect to Article 7:

  • (a) as regards paragraph 3, it is understood that nothing contained therein shall require a Contracting State to allow the total deduction of certain expenses when they are limited in some way in the determination of profits under its domestic tax legislation or to allow the deduction of any expenditure which, by reason of its nature, is not generally allowed as a deduction under the taxation laws of that State;

  • (b) as regards paragraph 5, the export of goods or merchandise purchased by an enterprise shall, notwithstanding the provisions of subparagraph (d) of paragraph 4 of Article 5 of the Convention, remain subject to the domestic legislation in force concerning export.

• 2 With respect to Article 12:

  • (a) the limitations on the taxation at source provided for under paragraph 2 are, in the case of Argentina, subject to the registration, verification and authorization requirements provided for in its domestic legislation;

  • (b) the limitation on the taxation at source of royalties referred to in subparagraph (b) of paragraph 2 shall apply only if the royalties are derived by the author himself or his descendants;

  • (c) in the case of payments for technical assistance the tax payable in accordance with subparagraph (c) of paragraph 2 shall be determined after the deduction of expenses for the personnel which renders the assistance in the Contracting State in which they are rendered and the costs and expenses of any equipment brought by the provider of the assistance for the specific purpose of rendering the assistance.

• 3 With respect to Article 21, it is understood that income derived by a resident of Argentina from a trust, other than a trust to which contributions were deductible, or an estate which is a resident of Canada may be taxed in Canada in accordance with its law; however, provided that the income is taxable in Argentina, the tax so charged shall not exceed 15 per cent of the gross amount of the income.

• 4 Nothing contained in the Convention shall prevent Argentina from taxing, at the rate determined by Argentine law, the profits or income attributable to a permanent establishment maintained in Argentina by a company which is a resident of Canada. However, the total amount of tax so charged shall not exceed the income tax applied on profits of an Argentine company plus 10 per cent of such profits after deduction of such company tax.

• 5 It is understood that the provisions of the Convention shall not be interpreted so as to prevent the application by a Contracting State of the thin capitalization provisions provided for in its domestic legislation.

• 6 If after the date of signature of the Convention the Argentine Republic concludes a double taxation Convention with a State that is a Member country of the Organisation for Economic Co-operation and Development which limits the taxation in the country of source of payments for technical assistance referred to in Article 12 or for independent personal services performed in the absence of a fixed base referred to in paragraph 1 of Article 14, to a rate that is lower than that provided for in this Convention, the lower rate (including an exemption) shall automatically apply for the purposes of this Convention from the date of entry into force of the first-mentioned Convention.

IN WITNESS WHEREOF the undersigned, duly authorized to that effect, have signed this Protocol.

DONE in duplicate at Buenos Aires, this 29th day of April 1993, in the English, French and Spanish languages, each version being equally authentic.