The Double Taxation Relief (Air Transport) (Saudi Arabia) Order 1994

Made: 15th March 1994

At the Court at Buckingham Palace, the 15th day of March 1994 Present, The Queen’s Most Excellent Majesty in Council

Now, therefore, Her Majesty, in exercise of the powers conferred upon Her by section 788 of the said Act, and of all other powers enabling Her in that behalf, is pleased, by and with the advice of Her Privy Council, to order, and it is hereby ordered, as follows:—

1

This Order may be cited as the Double Taxation Relief (Air Transport) (Saudi Arabia) Order 1994.

2

It is hereby declared—

• (a) that the arrangements specified in the Agreement set out in the Schedule to this Order have been made with the Government of the Kingdom of Saudi Arabia with a view to affording relief from double taxation in relation to income tax, corporation tax or capital gains tax and taxes of a similar character imposed by the laws of Saudi Arabia;

• (b) that it is expedient that those arrangements should have effect.

SCHEDULE — AGREEMENT BETWEEN THE GOVERNMENT OF THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND AND THE GOVERNMENT OF THE KINGDOM OF SAUDI ARABIA FOR THE AVOIDANCE ON A RECIPROCAL BASIS OF DOUBLE TAXATION ON REVENUES ARISING FROM THE BUSINESS OF INTERNATIONAL AIR TRANSPORT AND ON THE REMUNERATION OF EMPLOYEES OF ENTERPRISES ENGAGED IN SUCH BUSINESS

The Government of the United Kingdom of Great Britain and Northern Ireland and the Government of the Kingdom of Saudi Arabia;

Desiring to conclude an Agreement for the avoidance on a reciprocal basis of double taxation on revenues arising from the business of international air transport and on the remuneration of employees of enterprises engaged in such business;

Have agreed as follows:

ARTICLE 1

• (1) The taxes which are the subject of this Agreement are:

• (a) in the United Kingdom of Great Britain and Northern Ireland:

• (i) the income tax;

• (ii) the corporation tax;

• (iii) the capital gains tax;

(hereinafter referred to as “United Kingdom tax”);

• (b) in the Kingdom of Saudi Arabia: the income tax;

(hereinafter referred to as “Saudi Arabian tax”).

• (2) This Agreement shall also apply to any identical or substantially similar taxes which are imposed by either Contracting State after the date of signature of this Agreement in addition to, or in place of, the taxes referred to in paragraph (1) of this Article.The competent authorities of the Contracting States shall notify each other of any substantial changes which are made in their respective taxation laws.

ARTICLE 2

ARTICLE 3

ARTICLE 4

An individual who is a national of a Contracting State and an employee of an enterprise of that Contracting State as defined in Article 2(1)(c) of this Agreement and who derives remuneration in respect of duties performed for that enterprise in the other Contracting State shall be exempt from tax in that other State on remuneration derived from his employment with that enterprise for a period of four years beginning with the date on which he first performs duties in that other State.

ARTICLE 5

The competent authorities of the Contracting States shall through consultation endeavour to resolve by mutual agreement any difficulties or doubts regarding the interpretation or application of this Agreement.

ARTICLE 6

Each Contracting State shall notify the other through the diplomatic channel of the completion of the relevant procedures required by its law to bring this Agreement into force.The Agreement shall enter into force on the date of the later of these notifications and shall thereupon have effect as regards income derived from the operation of aircraft in international traffic arising on or after1st January 1989.

ARTICLE 7

This Agreement shall remain in force indefinitely but either Contracting State may terminate it by giving notice of termination, through the diplomatic channel, at least six months before the end of any calendar year.In such event this Agreement shall cease to have effect from 1st January of the calendar year next following that in which the notice is given.

Signed

N. H. Nicholls — Clerk of the Privy Council

Explanatory note

(This note is not part of the Order)

Under the Agreement with Saudi Arabia scheduled to this Order, income and profits derived from the operation of aircraft in international traffic by a designated enterprise of either the United Kingdom or Saudi Arabia will not be taxed in the other State. This also applies to income and profits derived from participation in a pool or joint business and to gains derived from the alienation of aircraft or moveable property.

Remuneration derived by a national of one state from his employment with a designated air transport undertaking of that state will be exempt from tax in the other state for a period of four years from the date on which he first performs duties in the other State.

The Agreement enters into force on the date of the later of the notifications by each country of the completion of its legislative procedures. It will then apply to income arising on or after 1st January 1989. The date of entry into force will in due course be published in the London, Edinburgh and Belfast Gazettes.

Footnotes

[^f00001]: 1988 c. 1; section 788 is extended by section 277 of the Taxation of Chargeable Gains Act 1992 (c. 12).