Law (2009:1113) If Agreement Between Sweden And The Cayman Islands For The Avoidance Of Double Taxation Of Natural Persons

Original Language Title: Lag (2009:1113) om avtal mellan Sverige och Caymanöarna för undvikande av dubbelbeskattning av fysiska personer

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Read the untranslated law here: http://rkrattsbaser.gov.se/sfst?bet=2009:1113

section 1 of the agreement between the Government of the Kingdom of Sweden and

Cayman Islands Government for the avoidance of double taxation of

natural persons signed on June 17, 2009

apply that law in this country. The agreement is drawn up in English

and set out in annex to this law.



section 2 of the tax rules of the agreement are to be applied only to the

share these results in reduction of the tax liability in

Sweden that would otherwise exist.



3 § If a person fully taxable in Sweden

acquires income pursuant to the agreement

be taxed only in the Cayman Islands, such income is not included

with the taxation in Sweden.



Transitional provisions



2009:1113



1. This law shall enter into force on the day the Government determines.



2. This Act shall apply



(a)) in respect of withholding taxes, on amounts paid or

tillgodoförs on 1 January of the year next following the

the date on which the Act comes into force or later, and



(b)) in respect of other taxes on income, to taxes levied

for tax years beginning on 1 January of the year

immediately following the day on which the Act comes into force or

later.





Annex



AGREEMENT BETWEEN THE GOVERNMENT OF THE KINGDOM OF SWEDEN AND THE GOVERNMENT OF THE CAYMAN ISLANDS FOR THE AVOIDANCE OF DOUBLE TAXATION ON INDIVIDUALS The Government of the Kingdom of Sweden and the Government of the Cayman Islands, desiring to conclude an Agreement for the avoidance of double taxation on individuals with respect to taxes on income, have agreed as follows : Article 1 Individuals covered



This Agreement shall apply to individuals who are residents of one or both of the Parties.



Article 2 Taxes covered



1. The existing taxes to which the Agreement shall apply are:



(a) in the case of the Cayman Islands: any tax imposed by the Cayman Islands which is substantially similar to the existing taxes of Sweden to which this Agreement applies (hereinafter referred to as "Cayman Islands tax");



(b) in the case of Sweden: (i) the State income tax (the national income tax);



(ii) the Special income tax for non-residents (the income tax on non-residents);



(iii) the Special income tax for non-residents artists and others. (the income tax on non-resident artistes and athletes); and (iv) the municipal income tax (the communal income tax) (hereinafter referred to as "Swedish tax").



2. The Agreement shall apply also to any identical or substantially similar taxes that are imposed after the date of signature of the Agreement in addition to, or in place of, the existing taxes. The competent authorities of the Parties shall notify each other of any significant changes that have been made in their taxation laws concerning individuals.



Article 3



General definition



1. For the purposes of this Agreement, unless the context otherwise requires: (a) the term "a Party" means the Cayman Islands or Sweden, as the context requires; the term "Parties" means the Cayman Islands and Sweden;



(b) the term "Cayman Islands" means the territory of the Cayman Islands and includes the territorial sea, areas within the maritime boundaries of the Cayman Islands and any area within which in accordance with international law the rights of the Cayman Islands with respect to the seabed and sub-soil and their natural resources may be exercised;



(c) the term "Sweden" means the Kingdom of Sweden and, when used in a geographical sense, includes the national territory, the territorial sea of Sweden as well as other maritime areas over which Sweden in accordance with international law exercises sovereign rights or jurisdiction;



(d) the term "competent authority" means;



(i) in the case of the Cayman Islands, the Dachshund Information Authority or a person or authority designated by it;



(ii) in the case of Sweden, the Minister of Finance, his authorised representative or the authority which is designated as a competent authority for the purposes of this Agreement;



(e) the term "enterprise" applies to the carrying on of any business;



(f) the term "international traffic" means any transport by a ship or aircraft operated by an enterprise of a Party, except when the ship or aircraft is operated solely between places in the other Party.



2. As regards the application of the Agreement at any time by a Party, any term not defined therein shall, unless the context otherwise requires, have the meaning that it has at that time under the law of that Party, any meaning under the applicable tax laws of that Party prevailing over a meaning given to the term under other laws of that Party.



Article 4 Resident



1. For the purposes of this Agreement, the term "resident of a Party" means: (a) in Sweden, in respect of an individual, any individual who, under the laws of Sweden, is liable to tax therein by reason of his domicile, residence or any other criterion of a similar nature. This term, however, does not include an individual who is liable to tax in Sweden in respect only of income from sources in Sweden;



(b) in the Cayman Islands, in respect of an individual, any individual who, under its laws, is recognised as a resident by reason of his domicile, residence or any other criterion of a similar nature.



2. Where by reason of the provisions of paragraph 1 an individual is a resident of both Parties, then his status shall be determined as follows: (a) he shall be deemed to be a resident only of the Party in which he has a permanent home available to him; If he has a permanent home available to him in both Parties, he shall be deemed to be a resident only of the Party with which his personal and economic relations are closer (centre of vital interests);



(b) if the Party in which he has his centre of vital interests cannot be determined, or if he has not a permanent home available to him in either Party, he shall be deemed to be a resident only of the Party in which he has an habitual abode;



(c) if he has an habitual abode in both Parties or in neither of them, the competent authorities of the Parties shall settle the question by mutual agreement.



Article 5 Income from employment 1. Subject to the provisions of Articles 6, 7, 8 and 9, salaries, wages and other similar remuneration derived by a resident of a Party in respect of an employment shall be taxable only in that Party unless the employment is exercised in the other Party. If the employment is so exercised, such remuneration as is derived there from may be taxed in that other Party.



2. Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of a Party in respect of an employment exercised in the other Party shall be taxable only in the first-mentioned Party if: (a) the recipient is present in the other Party for a period or periods not exceeding in the aggregate 183 days in any twelve month period commencing or ending in the fiscal year concerned; and (b) the remuneration is paid by, or on behalf of, an employer who is not a resident of the other Party; and (c) the remuneration is not borne by a fixed place of business through which the business is wholly or partly carried on which the employer has in the other Party.



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 an enterprise of a Party, may be taxed in that Party.



Article 6 Directors ' fees



Directors ' fees and other similar payments derived by a resident of a Party in his capacity as a member of the board of directors of a company which is a resident of the other Party may be taxed in that other Party.



Article 7 Artistes and sportsmen



1. Income derived by a resident of a Party "as an entertainer, such as a theatre, motion picture, radio or television artiste, or a musician, or as a sportsman, from his personal activities as such exercised in the other Party, may be taxed in that other Party.



2. Where income in respect of personal activities exercised by an entertainer or a sportsman in his capacity as such accrues not to the entertainer or sportsman himself but to another individual or legal entity, that income may be taxed in the Party in which the activities of the entertainer or sportsman are exercised.



Article 8



Pension



1. Pensions and other similar remuneration, disbursements under the Social Security legislation and annuities arising in a Party and paid to a resident of the other Party may be taxed in the first-mentioned Party.



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.



Article 9 Government service



1. (a) Salaries, wages and other similar remuneration, other than a pension, paid by a Party or a political subdivision or a statutory body or a local authority thereof to an individual in respect of services rendered to that Party or subdivision or body or authority shall be taxable only in that Party.



(b) However, such salaries, wages and other similar remuneration shall be taxable only in the other Party if the services are rendered in that Party and the individual is a resident of that Party who did not become a resident of that Party solely for the purpose of rendering the services.



2. The provisions of Articles 5, 6 and 7 shall apply to salaries, wages, and other similar remuneration in respect of services rendered in connection with a business carried on by


a Party or a political subdivision or a statutory body or a local authority thereof.



Article 10 Students



Payments which a student or business apprentice who is or was immediately before visiting a Party a resident of the other Party and who is present in the first-mentioned Party solely for the purpose of his education or training receives for the purpose of his maintenance, education or training shall not be taxed in that Party, provided that such payments arise from sources outside that Party.



Article 11 Elimination of double taxation



1. In the Cayman Islands double taxation shall be avoided in accordance with the laws of the Cayman Islands.



2. In Sweden, double taxation shall be avoided as follows:



(a) Where a resident of Sweden derives income which under the laws of the Cayman Islands and in accordance with the provisions of this Agreement may be taxed in the Cayman Islands, Sweden shall allow-subject to the provisions of the laws of Sweden concerning credit for foreign tax (as it may be amended from time to time without changing the general principle hereof)-as a deduction from the tax on such income , an amount equal to the Cayman Islands tax paid in respect of such income.



(b) Where a resident of Sweden derives income which, in accordance with the provisions of this Agreement, shall be taxable only in the Cayman Islands, Sweden may, when determining the graduated rate of Swedish tax, take into account the income which shall be taxable only in the Cayman Islands.



Article 12 Mutual agreement procedure



1. Where an individual considers that the actions of one or both of the Parties result or will result for him in taxation not in accordance with the provisions of this Agreement, he may, irrespective of the remedies provided by the domestic law of those Parties, present his case to the competent authority of the Party of which he is a resident. The case must be presented within three years from the first notification of the action resulting in taxation not in accordance with the provisions of the Agreement.



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 a satisfactory solution, to resolve the case by mutual agreement with the competent authority of the other Party, with a view to the avoidance of taxation which is not in accordance with the Agreement. Any agreement reached shall be implemented notwithstanding any time limits in the domestic law of the Parties.



3. The competent authorities of the Parties shall endeavour to resolve by mutual agreement any difficulties or doubts arising as to the interpretation or application of the Agreement.



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



Article 13



Entry into force



1. Each of the Parties shall notify the other in writing of the completion of the procedures required by its law for the entry into force of this Agreement.



2. The Agreement shall enter into force on the thirtieth day after the receipt of the later of these notifications and shall thereupon have effect (a) in the Cayman Islands: (b) in Sweden: (i) in respect of taxes withheld at source, for amounts paid or credited on or after the first day of January of the year next following the date on which the Agreement enters into force;



(ii) in respect of other taxes on income, on taxes chargeable for any tax year beginning on or after the first day of January of the year next following the date on which the Agreement enters into force.



3. This Agreement shall have effect provided that the Agreement signed on April 1, 2009 between the Government of the Kingdom of Sweden and the Government of the Cayman Islands concerning information on tax matters has effect.



Article 14



Termination



This Agreement shall remain in force until terminated by a Party. Either Party may terminate the Agreement by giving written notice of termination at least six months before the end of any calendar year. In such case, the Agreement shall cease to have effect (i) in respect of taxes withheld at source, for amounts paid or credited on or after the first day of January of the year next following the end of the six month period;



2) in respect of other taxes on income, to taxes levied for the fiscal year that begins on 1 January of the year following directly after the end of the six-month period or later.



In witness whereof the undersigned being duly authorised thereto have signed this Agreement.



Done at Paris, this 17th day of June 2009, in duplicate in the English language.



For the Government of the Kingdom of Sweden



Gunnar Lund For the Government of the Cayman Islands



William McKeeva Bush



(Translation)



AGREEMENT BETWEEN the GOVERNMENT of the KINGDOM of SWEDEN and the GOVERNMENT of the CAYMAN ISLANDS for the AVOIDANCE of DOUBLE TAXATION of NATURAL PERSONS



The Government of the Kingdom of Sweden and the Government of the Cayman Islands, which are part of an agreement for the avoidance of double taxation of natural persons with respect to taxes on income, have agreed as follows:



Article 1



Natural persons to whom the agreement applies



This agreement shall apply to the natural persons who are resident in a party, or both parties.



Article 2



Taxes covered by the agreement



1. The currently outgoing taxes to which this Agreement shall apply are:



(a)) in the Cayman Islands ' means any tax levied in the Cayman Islands which are of essentially similar kind as the currently outgoing taxes in Sweden on which this Agreement shall apply (in the following called "tax in the Cayman Islands"),



(b)) in Sweden: 1) the State income tax,



2) the Special income tax for non-residents, 3) the Special income tax for non-residents artists and others, and



4) the municipal income tax

(in the following referred to as "Swedish tax").



2. the agreement also applies to the taxes of the same or substantially similar form, after the signing of the agreement will be charged in addition to or in place of the currently outgoing taxes. The competent authorities of the Parties shall notify each other of the essential changes to the respective tax legislation relating to natural persons.



Article 3



General definitions



1. Unless the context shall give rise to another, have for the purposes of this agreement the following expressions below the specified importance:



(a)) "a party" refers to the Cayman Islands or Sweden, as the context may require;

"parties" refers to the Cayman Islands and Sweden,



(b)) "Cayman Islands" means the territory of the Cayman Islands, including its territorial waters and any area in which the Cayman Islands, in accordance with international law, may exercise rights with respect to the seabed and its supporting documents and related natural resources,



(c)) "Sweden" means the Kingdom of Sweden and the includes, if the term is used in the geographical sense, the territory of Sweden, Sweden's territorial waters and other maritime areas over which Sweden, in accordance with international law, exercises sovereign rights or jurisdiction;



d) "competent authority" means:



1) Cayman Islands: "the Tax Information Authority" or the person or authority that this appointment,



2) in Sweden: the Minister of finance or his authorised representative or the authority to whom has been assigned to be a competent authority for the purposes of this agreement, e) "company" means the pursuit of any form of movement,



f) "international transport" means transport by ships or aircraft used by an enterprise of a party, except when the ship or aircraft are used exclusively between places in the other party.



(2) where a party applies the agreement at any time shall be deemed to, unless the context shall give rise to another, any expressions that are not defined in this agreement have the meaning as the expression has at that time under the law of the party and the importance of the term has under the applicable tax laws of that party owns overrides the importance of expression have under other legislation in this party.



Article 4



Resident



1. for the purposes of this agreement the term "resident of a party":



(a)) in Sweden, in the case of a natural person, any natural person who, under the law in Sweden is taxable there because of domicile, residence or any other similar circumstance. That term includes, however, not individual who is liable to tax in Sweden only for income source in Sweden,



(b)) in the Cayman Islands, as far as concerns natural persons, any natural person who, in accordance with its legislation live there because of the domicile, residence or any other similar circumstance.



(2) where a natural person on the basis of the provisions of paragraph (1) is a resident of both parties, is determined his residence as follows:



(a)) he is considered to be resident only in the party in which he has a permanent home available to him. If he has such a home in both parties, he is considered to be resident only in the party with which his personal and economic relations are strongest (Centre of life interests), b) unless it can be determined in which party he's the center of their living interests or if he's not in either party have a dwelling that is permanently available to him, he is considered to be a resident only of the party in which he is permanently resident ,¨



c) if he is permanently resident in both parties or do not reside permanently in any of them, the competent authorities shall determine the question by mutual agreement.



Article 5



Individual service




1. the provisions of articles 6, 7, 8 and 9 give rise to different, taxed wages and other similar remuneration as a resident of a party receives on account of employment, only in that party, provided that the work is not carried out in the other party. If the work done in this second part, entitled to the allowance received for work are taxed there.



2. By way of derogation from paragraph 1, be taxed compensation as resident in a party receives for work performed in the other Contracting Party, only in the former party, if



(a)) the recipient residing in the other party during the period or periods not exceeding a total of 183 days during a 12-month period commencing or ending in the fiscal year concerned, and



(b) the remuneration is paid by the employer) who do not live in the other party or on behalf of, and



c) compensation is not charged a habitual place of business activities the employer has in the other party and from which the business is wholly or partly carried on.



3. Notwithstanding the preceding provisions of this article, remuneration for work carried out on board ships or aircraft in international traffic by an enterprise of a party, be taxed in that party.



Article 6



Directors ' fees



Directors ' fees and other similar remuneration, as a resident of a party receives as a member of the Board of Directors in companies domiciled in the other party, may be taxed in that other party.



Article 7



Artists and sportsmen and women



1. income which a resident of a party acquires by virtue of their personal business of the other party as artist, such as theater or film actor, radio or television artiste, or a musician, or as sportsmen and women, may be taxed in that other party.



2. In cases where the income through personal business, as an artist or sportsmen and women exercising in that capacity, not become the property of the artist or sportutövaren yourself without other natural or legal person, that income may be taxed in the Contracting Party where the artist or sportutövaren exercise activities.



Article 8



Pension



1. Pensions and other similar remuneration, payment under the social security legislation and annuities, which are derived from a party and paid to a resident of the other party, may be taxed in the first-mentioned party.



2. The term "annuity" means a specified amount payable periodically at stated times during a person's lifetime or during a specified or ascertainable period of time and which are due to the obligation to effect such payments as consideration for the defendant, however, consideration in money or money value.



Article 9



Public service



1. a) Salary and other compensation, except for pension, paid by a party, one of its political subdivisions or local authorities, bodies governed by public law to natural persons on the basis of work done in that party, section, body, or Government service, are subject to tax only in that party.



b) Such salary and other similar compensation is taxed only in the other Contracting Party on the work carried out in the other party and the person in question is domiciled in that Contracting Party and not got a resident of that party exclusively to carry out the work.



2. the provisions of articles 5, 6 and 7 apply to wages and other similar remuneration paid on account of the work carried out in connection with the motion of a party, one of its political subdivisions or local authorities, bodies governed by public law.



Article 10



Students



Student or business trainee who is, or immediately before the party was domiciled in the other party and residing in the first-mentioned party solely for their teaching or practice, not subject to tax in that Contracting Party for the amount that he receives for his subsistence, education or training, provided that the amounts derived from source outside that party.



Article 11



The Elimination of double taxation



1. In the Cayman Islands to double taxation be eliminated in accordance with the laws of the Cayman Islands.



2. In Sweden double taxation shall be eliminated as follows:



(a)) where a resident of Sweden acquires income which under the laws of the Cayman Islands and in accordance with the provisions of this agreement may be subject to taxation in the Cayman Islands, to Sweden-having regard to the provisions of Swedish legislation relating to the deduction of foreign tax (even as they can get by without changes to the general principle set out this change)-from the Swedish tax set off an amount equal to the tax in the Cayman Islands that paid on income.



b) where a resident of Sweden acquires income which, in accordance with the provisions of this agreement are subject to tax only in the Cayman Islands, may in determining Sweden Swedish progressive tax consider such income which is taxed only in the Cayman Islands.



Article 12



Mutual agreement procedure



1. If an individual considers that a party or both parties acted as for him, causes or will result in taxation contrary to the provisions of this agreement, he may, without prejudice to his right to make use of the remedies available in these parties ' internal legal order, submit the matter to the competent authority of the Contracting Party where he is resident. The thing to be presented within three years from the date on which the person in question had knowledge of the action that gave rise to taxation contrary to the provisions of the agreement.



2. If the competent authority finds the objection founded but cannot bring about a satisfactory resolution, the authority shall seek its decision by mutual agreement with the competent authority of the other party in order to avoid taxation which is contrary to the agreement. Agreement reached is carried out without prejudice to the time limits in the domestic law of the parties.



3. the competent authorities of the Parties shall decide by mutual agreement, seek difficulties or doubts arising concerning the interpretation or application of the agreement.



4. the competent authorities of the parties may enter into direct relations with each other in order to reach agreement in the sense of the preceding paragraphs.



Article 13



Date of entry into force



1. Each Party shall notify the other party if the measures taken pursuant to their respective legislation required that this agreement should enter into force.



2. the agreement shall enter into force on the thirtieth day following the date on which the last of these notifications is received and applied



(a)) in Cayman Islands:

in the case of tax in the Cayman Islands, as of that date, b) in Sweden:



1) in respect of withholding taxes, on amounts paid or tillgodoförs on 1 January of the year following immediately after the date of entry into force of the agreement or later,



2) in respect of other taxes on income, to taxes levied for the fiscal year that begins on 1 January of the year following immediately after the date of entry into force of the agreement or at a later time.



3. this agreement is applicable provided that the agreement between the Government of the Kingdom of Sweden and the Government of the Cayman Islands of information in tax matters signed on 1 april 2009 are applicable.



Article 14



Termination



This agreement will remain in force until it is terminated by either party. Each party may terminate the agreement by giving written notice to that effect at least six months before the end of any calendar year. In the event of such termination, the agreement ceases to be valid



1) in respect of withholding taxes, on amounts paid or tillgodoförs on 1 January of the year following directly after the end of the six-month period or later,



2) in respect of other taxes on income, to taxes levied for the fiscal year that begins on 1 January of the year following directly after the end of the six-month period or later.



In witness whereof the undersigned, being duly authorised, have signed this agreement.



Done at Paris on 17 June 2009, in duplicate in the English language.



For the Government of the Kingdom of Sweden



Gunnar Lund



For the Cayman Islands Government William McKeeva Bush