The Government of the Republic of Singapore and the Government of the Italian Republic;

    Desiring to conclude a Convention for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income.

    Have agreed as follows:

    This Convention shall apply to persons who are residents of one or both of the Contracting States.

1.  This Convention shall apply to taxes on income imposed on behalf of each Contracting State or of its political or administrative subdivisions or local authorities, irrespective of the manner in which they are levied.

2.  There shall be regarded as taxes on income all taxes imposed on total income or on elements of income, including taxes on gains from the alienation of movable or immovable property, taxes on the total amounts of wages or salaries paid by enterprises, as well as taxes on capital appreciation.

3.  The existing taxes to which the Convention shall apply are, in particular:

4.  The Convention shall also apply to any identical or substantially similar taxes which are imposed after the date of signature of this Convention in addition to, or in place of, the existing taxes. The competent authorities of the Contracting States shall notify to each other any significant changes which have been made in their respective taxation laws.

1.  In this Convention, unless the context otherwise requires:

2.  As regards the application of the Convention by a Contracting State any term not otherwise defined shall, unless the context otherwise requires, have the meaning which it has under the laws of that Contracting State relating to the taxes which are the subject of the Convention.

1.  For the purposes of this Convention, the term “resident of a Contracting State” means any person who, under the law of that State, is liable to taxation therein by reason of his domicile, residence, place of management or any other criterion of a similar nature. But this term does not include any person who is liable to tax in that Contracting State in respect only of income from sources situated in that State.

2.  Where by reason of the provisions of paragraph 1 an individual is a resident of both Contracting States, then his status shall be determined as follows:

3.  Where by reason of the provisions of paragraph 1 a person other than an individual is a resident of both Contracting States, then it shall be deemed to be a resident of the Contracting State in which its place of effective management is situated.

1.  For the purposes of this Convention, the term “permanent establishment” means a fixed place of business in which the business of the enterprise is wholly or partly carried on.

2.  The term “permanent establishment” shall include especially:

3.  The term “permanent establishment“ shall not be deemed to include:

4.  An enterprise of a Contracting State shall be deemed to have a permanent establishment in the other Contracting State if it carries on supervisory activities in that other Contracting State for more than six months in connection with a building site, construction, installation or assembly project which is being undertaken in that other Contracting State.

5.  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 6 applies — shall be deemed to be a permanent establishment in the first-mentioned Contracting State if:

6.  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 broker, general commission agent or any other agent of an independent status, where such persons are acting in the ordinary course of their business.

7.  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 constitute either company a permanent establishment of the other.

1.  Income from immovable property including income from agriculture or forestry may be taxed in the Contracting State in which such property is situated.

2.  The term “immovable property” shall be defined in accordance with the law of the Contracting State in which the property in question is situated. The term shall, in any case, include property accessory to immovable property, livestock and equipment used in agriculture and forestry, rights to which the provisions of general law respecting landed property apply, usufruct of immovable property and rights to variable or fixed payments as consideration for the working of, or the right to work, mineral deposits, sources and other natural resources; ships, boats and aircraft shall not be regarded as immovable property.

3.  The provisions of paragraph 1 shall apply to income derived from the direct use, letting, or use in any other form of immovable property.

4.  The provisions of paragraphs 1 and 3 shall also apply to the income from immovable property of an enterprise.

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 therein. If the enterprise carries on business as aforesaid, 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 therein, 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.

3.  In the determination of the profits of a permanent establishment, there shall be allowed as deductions expenses which are incurred for the purposes of the permanent establishment including executive and general administrative expenses so incurred, whether in the State in which the permanent establishment is situated or elsewhere.

4.  Insofar as it has been customary in a Contracting State to determine the profits to be attributed to a permanent establishment on the basis of an apportionment of the total profits of the enterprise to its various parts, nothing in paragraph 2 shall preclude that Contracting State from determining the profits to be taxed by such an apportionment as may be customary; the method of apportionment adopted shall, however, be such that the result shall be in accordance with the principles embodied in this article.

5.  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.

6.  For the purposes of the preceding paragraphs, 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 profits include items of income which are dealt with separately in other articles of this Convention, then the provisions of those articles shall not be affected by the provisions of this article.

1.  Profits from the operation of ships or aircraft in international traffic shall be taxable only in the Contracting State in which the place of effective management of the enterprise is situated.

2.  If the place of effective management of a shipping enterprise is aboard a ship, then it shall be deemed to be situated in the Contracting State in which the home harbour of the ship is situated, or, if there is no such home harbour, in the Contracting State of which the operator of the ship is a resident.

3.  The provisions of paragraph 1 shall also apply to profits derived from the participation in a pool, a joint business or in an international operating agency.

1.  Dividends paid by a company which is a resident of a Contracting State to a resident of the other Contracting State may be taxed in that other State.

2.  However, such dividends may be taxed in the Contracting State of which the company paying the dividends is a resident, and according to the law of that State, but if the recipient is the beneficial owner of the dividends the tax so charged shall not exceed 10 per cent of the gross amount of the dividends.

    The competent authorities of the Contracting States shall by mutual agreement settle the mode of application of this limitation.

    This paragraph shall not affect the taxation of the company in respect of the profits out of which the dividends are paid.

3.  The term “dividends” as used in this Article means income from shares, “jouissance” shares or “jouissance” rights, mining shares, founders’ shares or other rights, not being debt-claims, participating in profits, as well as income from other corporate rights which is subjected to the same taxation treatment as income from shares by the taxation law of the State which the company making the distribution is a resident.

4.  The provisions of paragraphs 1 and 2 shall not apply if the recipient of 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 therein and the holding in respect of which the dividends are paid is effectively connected with such permanent establishment. In such a case the dividends are taxable in that other Contracting State according to its own law.

5.  Where a company which is a resident of a Contracting State derives profits or income from the other Contracting State, that other State may not impose any tax on the dividends paid by the company, except insofar as such dividends are paid to a resident of that other State or insofar as the holding in respect of which the dividends are paid is effectively connected with a permanent establishment situated in that other State, or subject the company’s undistributed profits to a tax on undistributed profits, even if the dividends paid or the undistributed profits consist wholly or partly of profits or income arising in such other State.

1.  Interest arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State.

2.  However, such interest may be taxed in the Contracting State in which it arises, and according to the law of that State, but if the recipient is the beneficial owner of the interest, the tax so charged shall not exceed 12½ per cent of the amount of the interest. The competent authorities of the Contracting States shall by mutual agreement settle the mode of application of this limitation.

3.  Notwithstanding the provisions of paragraph 2, interest arising in a Contracting State shall be exempt from tax in that State if the interest is paid to the Government of the other Contracting State or local authority or any agency or instrumentality (including a financial institution) in relation to loans made in application of an agreement concluded between the Governments of the Contracting States.

4.  The term “interest” as used in this Article means income from Government securities, bonds or debentures, whether or not secured by mortgage and whether or not carrying a right to participate in profits, and debt-claims of every kind as well as all other income assimilated to income from money lent by the taxation law of the State in which the income arises.

5.  The provisions of paragraphs 1 and 2 shall not apply if the recipient of 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 therein, and the debt claimed in respect of which the interest is paid is effectively connected with such permanent establishment. In such a case, the interest is taxable in that other Contracting State according to its own law.

6.  Interest shall be deemed to arise in a Contracting State when the payer is that State itself, a political or administrative subdivision, a local authority or a resident of that State. Where, however, the person paying the interest, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment in connection with which the indebtedness on which the interest is paid was incurred, and such interest is borne by such permanent establishment, then such interest shall be deemed to arise in the Contracting State in which the permanent establishment is situated.

7.  Where, owing to a special relationship between the payer and the recipient or between both of them and some other person, the amount of the interest paid, having regard to the debt-claim for which it is paid, exceeds the amount which would have been agreed upon by the payer and the recipient in the absence of such relationship, the provisions of this Article shall apply only to the last-mentioned amount. In that case, the excess part of the payments shall remain taxable according to the law of each Contracting State, due regard being had to the other provisions of this Convention.

1.  Royalties arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State.

2.  However, such royalties may be taxed in the Contracting State in which they arise, and according to the law of that Contracting State, but if the recipient is the beneficial owner of the royalties, the tax so charged shall not exceed:

    The competent authorities of the Contracting States shall by mutual agreement settle the mode of application of this limitation.

3.  The provisions of paragraphs 1 and 2 shall not apply if the recipient of 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 therein, and the right or property in respect of which the royalties are paid is effectively connected with such permanent establishment. In such a case, the royalties are taxable in that other Contracting State according to its own law.

4.  Royalties shall be deemed to arise in a Contracting State when the payer is that Contracting State itself, a political or administrative subdivision, a local authority or a resident of that Contracting State. Where, however, the person paying the royalties, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment in connection with which the liability to pay the royalties was incurred, and such royalties are borne by such permanent establishment, then such royalties shall be deemed to arise in the Contracting State in which the permanent establishment is situated.

5.  Where, owing to a special relationship between the payer and the recipient or between both of them and some other person, the amount of the royalties paid, having regard to the use, right or information for which they are paid, exceeds the amount which would have been agreed upon by the payer and the recipient in the absence of such relationship, the provisions of this Article shall apply only to the last-mentioned amount. In that case, the excess part of the payments shall remain taxable according to the law of each Contracting State, due regard being had to the other provisions of this Convention.

1.  Gains from the alienation of immovable property, as defined in paragraph 2 of Article 6, may be taxed in the Contracting State in which such property is situated.

2.  Gains from the alienation of movable property forming part of the business property of a permanent establishment which an enterprise of a Contracting State has in the other Contracting State, including such gains from the alienation of such a permanent establishment (alone or together with the whole enterprise), may be taxed in the other State.

3.  Gains from the alienation of any property other than those mentioned in paragraphs 1 and 2, shall be taxable only in the Contracting State of which the alienator is a resident.

1.  Subject to the provisions of Articles 15, 17 and 18, salaries, wages and other similar remuneration or income for personal (including professional) services derived by a resident of a Contracting State, shall be taxable only in that State unless the services are performed in the other Contracting State. If the services are so performed, such remuneration or income as is derived therefrom may be taxed in that other State.

2.  Notwithstanding the provisions of paragraph 1, remuneration or income derived by a resident of a Contracting State in respect of personal (including professional) services performed in the other Contracting State shall be taxable only in the first-mentioned State if:

3.  Notwithstanding the preceding provisions of this Article, remuneration in respect of an employment exercised aboard a ship or aircraft in international traffic, shall be taxed only in the Contracting State in which the place of effective management of the enterprise is situated.

    Directors’ fees and similar payments derived by a resident of a Contracting State in his 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.

1.  Notwithstanding the provisions of Article 14, income derived by entertainers, such as theatre, motion picture, radio or television artistes, and musicians, and by athletes, from their personal activities as such may be taxed in the Contracting State in which these activities are exercised.

2.  The provisions of paragraph 1 shall not apply to remuneration or profits, salaries, wages and similar income derived from activities performed in a Contracting State by public entertainers if the visit to that Contracting State is substantially supported by public funds of the other Contracting State, including any political or administrative subdivision, local authority or statutory body thereof.

3.  Where income in respect of personal activities as such of an entertainer or athlete accrues not to that entertainer or athlete himself but to another person that income may, notwithstanding the provisions of Articles 7 and 14, be taxed in the Contracting State in which the activities of the entertainer or athlete are exercised.

    Subject to the provisions of paragraph 2 of Article 18, pensions and other similar remuneration paid to a resident of a Contracting State in consideration of past employment shall be taxable only in that State.

1.—(a)  Remuneration, other than a pension, paid by a Contracting State or a political or an administrative subdivision or a local authority thereof to any individual in respect of services rendered to that State or subdivisions or local authority thereof shall be taxable only in that State.

2.—(a)  Any pension paid by, or out of funds created by, a Contracting State or a political or an administrative subdivision or a local authority thereof to any individual in respect of services rendered to that State or subdivision or local authority thereof shall be taxable only in that State.

3.  The provisions of Articles 14, 15 and 17 shall apply to remuneration or pensions in respect of services rendered in connection with any trade or business carried on by one of the Contracting States or a political or an administrative subdivision or a local authority thereof.

1.  An individual who is a resident of a Contracting State immediately before making a visit to the other Contracting State, and who, at the invitation of any university, college, school or other similar educational institution, which is recognised by the competent authority in that other Contracting State, visit that other Contracting State for a period not exceeding two years solely for the purpose of teaching or research or both at such educational institution shall be taxable only in the first-mentioned Contracting State on his remuneration for such teaching or research.

2.  This Article shall not apply to income from research if such research is undertaken not in the public interest but primarily for the private benefit of a specific person or persons.

    Payments which a student or business apprentice who is or was formerly a resident of a Contracting State and who is present in the other Contracting State solely for the purpose of his education or training receives for the purpose of his maintenance, education or training shall be exempt from tax in that other Contracting State, provided that such payments are made to him from outside that other Contracting State.

    Items of income of a resident of a Contracting State which are not expressly mentioned in the foregoing Articles of this Convention may be taxed in both Contracting States.

1.  It is agreed that double taxation shall be avoided in accordance with the following paragraphs of this Article.

2.  If a resident of Italy owns items of income which are taxable in the Republic of Singapore, Italy in determining its income taxes specified in Article 2 of this Convention, may, regardless of any other provision of this Convention, include in the basis upon which such taxes are imposed the said items of income.

    In such a case, Italy shall deduct from the taxes so calculated the Singapore tax on such items of income, but in an amount not exceeding that proportion of the aforesaid Italian tax which such items of income bear to the entire income.

    On the contrary no deduction will be granted if the items of income are subjected in Italy to a final withholding tax by request of the recipient of the said items of income in accordance with the Italian law.

3.  Subject to the laws of Singapore regarding the allowance as a credit against Singapore tax of tax payable in any country other than Singapore, Italian tax payable in respect of income derived from Italy shall be allowed as a credit against Singapore tax payable in respect of that income.

4.  For the purposes of paragraphs 2 and 3 of this Article, where tax on dividends, interest or royalties arising in a Contracting State is exempted or reduced for a limited period in accordance with the laws of that State, such tax which has been exempted or reduced shall be deemed to have been paid at an amount not exceeding —

1.  The nationals or citizens of a Contracting State shall not be subjected in the other Contracting State to any taxation or any requirement connected therewith which is other or more burdensome than the taxation and connected requirements to which nationals or citizens of that other State in the same circumstances are or may be subjected.

2.  The taxation on a permanent establishment which an enterprise of a Contracting State has in the other Contracting State shall not be less favourably levied in that other State than the taxation levied on enterprises of that other State carrying on the same activities.

    This provision shall not be construed as obliging a Contracting State to grant to residents of the other Contracting State any personal allowances, reliefs and reductions for taxation purposes on account of civil status or family responsibilities which it grants to its own residents.

3.  Except where the provisions of Article 9, paragraph 7 of Article 11, or paragraph 5 of Article 12, apply, interest, royalties and other disbursements paid by an enterprise of a Contracting State to a resident of the other Contracting State shall, for the purpose of determining the taxable profits of such enterprise, be deductible under the same condition as if they had been paid to a resident of the first-mentioned State.

4.  Enterprises of a Contracting State, the capital of which is wholly or partly owned or controlled, directly or indirectly, by one or more residents of the other Contracting State, shall not be subjected in the first-mentioned Contracting State to any taxation or any requirement connected therewith which is other or more burdensome than the taxation and connected requirements to which other similar enterprises of that first-mentioned State are or may be subjected.

5.  In this Article the term “taxation” means taxes which are the subject of this Convention.

1.  Where a resident of a Contracting State considers that the actions of one or both of the Contracting States result or will result for him in taxation not in accordance with this Convention, he may, notwithstanding the remedies provided by the national laws of those States, present his case to the competent authority of the Contracting State of which he is a resident or, if his case comes under paragraph 1 of Article 23, to that of the Contracting States of which he is a national or citizen. This case must be presented within three years from the first notification of the action giving rise to taxation not in accordance with the Convention.

2.  The competent authority shall endeavour, if the objection appears to it to be justified and if it is not itself able to arrive at an appropriate solution, to resolve the case by mutual agreement with the competent authority of the other Contracting State, with a view to the avoidance of taxation which is not in accordance with the Convention. Any agreement reached shall be implemented notwithstanding any time limits in the national laws of the Contracting States.

3.  The competent authorities of the Contracting States shall endeavour to resolve by mutual agreement any difficulties or doubts arising as to the interpretation or application of the Convention. They may also consult together for the elimination of double taxation in cases not provided for in the Convention.

4.  The competent authorities of the Contracting States may communicate with each other directly for the purpose of reaching an agreement in the sense of the preceding paragraphs.

1.  The competent authorities of the Contracting States shall exchange such information as is necessary for the carrying out of this Convention and of the domestic laws of the Contracting States concerning taxes covered by this Convention insofar as the taxation thereunder is in accordance with this Convention. Any information so exchanged shall be treated as secret and shall not be disclosed to any persons or authorities other than those concerned with the assessment or collection of the taxes which are the subject of the Convention.

2.  In no case shall the provisions of paragraph 1 be construed so as to impose on one of the Contracting States the obligation:

    Nothing in this Convention shall affect the fiscal privileges of diplomatic or consular officials under the general rules of international law or under the provisions of special agreements.

1.  Taxes withheld at the source in a Contracting State will be refunded by request of the taxpayer or of the State of which he is a resident if the right to collect the said taxes is affected by the provisions of this Convention.

2.  Claims for refund, that shall be produced within the time limit fixed by the law of the Contracting State which is obliged to carry out the refund, shall be accompanied by an official certificate of the Contracting State of which the taxpayer is a resident certifying the existence of the conditions required for being entitled to the application of the allowances provided for by this Convention.

3.  The competent authorities of the Contracting States shall by mutual agreement settle the mode of application of this Article, in accordance with the provisions of Article 24 of this Convention.

1.  This Convention shall be ratified and the instruments of ratification shall be exchanged at Rome as soon as possible.

2.  This Convention shall enter into force on the date of the exchange of instruments of ratification and its provisions shall be effective:

3.  Claims for refund or credits arising in accordance with this Convention in respect of any tax payable before the entry into force of this Convention by residents of either of the Contracting States shall be lodged within three years from the date of entry into force of this Convention or from the date the tax was charged whichever is later.

    This Convention shall remain in force until terminated by one of the Contracting States. Either Contracting State may terminate the Convention, through diplomatic channels, not earlier than five years after its entry into force by giving notice of termination at least six months before the end of the calendar year. In such event, the Convention shall cease to be effective:

    IN WITNESS THEREOF the undersigned, duly authorised thereto, have signed the present Convention.

    DONE in duplicate at Singapore the 29th day of January 1977, in the English and Italian Languages, both texts being equally authoritative.

    At the signing of the Convention concluded today between the Republic of Singapore and the Republic of Italy for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income, the undersigned have agreed upon the following additional provisions which shall form an integral part of the said Convention.

    It is understood:

    DONE in duplicate at Singapore the 29th day of January 1977, in the English and Italian Languages, both texts being equally authoritative.

    I have the honour to refer to paragraph 2 of Article 12 of the Convention between the Government of Singapore and the Government of Italy for the Avoidance of Double Taxation and the prevention of Fiscal Evasion with respect to Taxes on Income signed today at Singapore and to propose on behalf of the Government of the Republic of Italy, that the two Governments shall agree that, if the Government of Singapore in any Convention concluded with other OECD countries limiting the rate of tax on royalties relating to any copyright of literary or artistic work, including cinematograph films or tapes for television or broadcasting to a rate less than twenty per cent of the gross amount of the royalties, the two Governments shall consult each other with a view to modify the said Article in order to extend the same treatment on a reciprocal basis. The Government of Singapore shall inform the Government of Italy about any new Convention with OECD countries which has a rate of less than twenty per cent on such royalties as soon as possible.

    I have further the honour to propose that the present Note and Your Excellency’s reply confirming the acceptance by the Government of Singapore of the above proposal shall be regarded as constituting an agreement between the two Governments concerning paragraph 2 of Article 12 of the said Convention.

    I avail myself of this opportunity to extend to Your Excellency the assurance of my highest consideration.

    I have the honour to acknowledge the receipt of Your Excellency’s Note of this date which reads as follows:

    “I have the honour to refer to paragraph 2 of Article 12 of the Convention between the Government of Singapore and the Government of Italy for the Avoidance of Double Taxation and the prevention of Fiscal Evasion with respect to Taxes on Income signed today at Singapore and to propose on behalf of the Government of the Republic of Italy, that the two Governments shall agree that, if the Government of Singapore in any Convention concluded with other OECD countries limiting the rate of tax on royalties relating to any copyright of literary or artistic work, including cinematograph films or tapes for television or broadcasting to a rate less than twenty per cent of the gross amount of the royalties, the two Governments shall consult each other with a view to modify the said Article in order to extend the same treatment on a reciprocal basis. The Government of Singapore shall inform the Government of Italy about any new Convention with OECD countries which has a rate of less than twenty per cent on such royalties as soon as possible.

    I have further the honour to propose that the present Note and Your Excellency’s reply confirming the acceptance by the Government of Singapore of the above proposal shall be regarded as constituting an agreement between the two Governments concerning paragraph 2 of Article 12 of the said Convention.”

    I have further the honour to confirm that the Government of Singapore accepts the proposal contained in Your Excellency’s Note, and to agree that the same and the present reply shall be regarded as constituting an agreement between the two Governments concerning paragraph 2 of Article 12 of the said Convention.

    I avail myself of this opportunity to extend to Your Excellency the assurance of my highest consideration.