- 1
- The Netherlands, when imposing tax on his residents, may include in the basis upon which such taxes are imposed, the items of income or capital which, according to the provisions of this Convention, may be taxed or shall be taxable only in Andorra. In such cases, however, the Netherlands shall allow a reduction of or a deduction from the Netherlands tax according to the provisions of paragraphs 2, 3, 4, 5 and 6, except to the extent that the provisions of this Convention allow taxation by Andorra solely because the items of income or capital are also income derived or capital owned by a resident of Andorra.
- 2
- Where a resident of the Netherlands derives items of income or owns items of capital which according to paragraphs 1, 3 and 4 of Article 6, paragraph 1 of Article 7, paragraph 1 and 3 of Article 8, paragraph 6 of Article 10, paragraph 3 of Article 11, paragraph 4 of Article 12, paragraphs 1, 2 and 3 of Article 13, paragraph 1 of Article 14, paragraph 2 of Article 17, paragraph 1 and subparagraph a of paragraph 3 of Article 18, paragraph 2 of Article 20 and paragraphs 1, 2 and 3 of Article 21 of this Convention may be taxed in Andorra, and are included in the basis referred to in paragraph 1, the Netherlands shall exempt such items of income or capital by allowing a reduction of its tax. This reduction shall be computed in conformity with the provisions of the Netherlands law for the elimination of double taxation. For that purpose the said items of income or capital shall be deemed to be included in the amount of the items of income or capital which are exempt from Netherlands tax under those provisions.
- 3
- The provisions of paragraph 2 shall not apply to items of income derived or of capital owned by a resident of the Netherlands where Andorra applies the provisions of this Convention to exempt such items of income or capital from tax or applies the provisions of paragraph 2 or 3 of Article 10, paragraph 2 of Article 12 to such items of income or capital.
- 4
- Notwithstanding the provisions of paragraph 2 and 3, the Netherlands shall allow a deduction from the Netherlands tax for the tax paid in Andorra on items of income which according to paragraph 1 of Article 7, paragraph 6 of Article 10, paragraph 3 of Article 11, paragraph 4 of Article 12, paragraph 2 of Article 13 and paragraph 2 of Article 20 of this Convention may be taxed in Andorra, to the extent that these items of income are included in the basis referred to in paragraph 1, insofar as the Netherlands under the provisions of the Netherlands law for the elimination of double taxation allows a deduction from the Netherlands tax of the tax levied in another jurisdiction on such items of income. For the computation of this deduction the provisions of paragraph 5 of this Article shall apply accordingly.
- 5
- Where a resident of the Netherlands derives items of income which according to paragraphs 2, 3 and 8 of Article 10, paragraph 2 of Article 12, paragraph 4 and 6 of Article 13, Article 15, paragraphs 1 and 2 of Article 16 and paragraph 3 of Article 17 of this Convention may be taxed in Andorra, the Netherlands shall allow a deduction from its tax to the extent that these items are included in the basis referred to in paragraph 1. The amount of this deduction shall be equal to the tax paid in Andorra on these items of income, but shall, in case the provisions of the Netherlands law for the elimination of double taxation provide so, not exceed the amount of the deduction which would be allowed if the items of income so included were the sole items for which the Netherlands gives a deduction under the provisions of the Netherlands law for the elimination of double taxation.
- 6
- The provisions of paragraph 5 shall not restrict allowance now or hereafter accorded by the provisions of the Netherlands law for the elimination of double taxation, but only as far as the calculation of the amount of the deduction from Netherlands tax is concerned with respect to the aggregation of income from more than one jurisdiction and the carry forward of the tax paid in Andorra on the said items of income to subsequent years.
- 7
- Subject to the provisions of the law of Andorra regarding the elimination of double taxation which shall not affect the general principle hereof, double taxation shall be eliminated as follows:
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- a)where a resident of Andorra derives income or owns capital which, in accordance with the provisions of this Convention, may be taxed in Netherlands, Andorra shall allow as a deduction from the tax of that resident an amount equal to the tax paid in Netherlands.Such deduction shall not, however, exceed that part of the Andorran tax, as computed before the deduction is given, which is attributable to such items of income derived from Netherlands.
- b)Where a resident of Andorra derives income or owns capital which, in accordance with the provisions of this Convention is exempt from tax in Andorra, Andorra may in order to calculate the amount of tax on the remaining income or capital of the resident, take into account the income or capital has been exempted.
