Pensions, retirement annuities and social security payments
- 1
- Pensions and other similar retirement remuneration (including retirement annuities) arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in the first-mentioned State.
- 2
- Pensions and other payments made under a social security legislation of a Contracting State to a resident of the other Contracting State may be taxed in the first-mentioned State.
- 3
- A pension or other similar retirement remuneration shall be deemed to arise in a Contracting State insofar as the contributions or payments associated with that pension or other similar retirement remuneration, or the entitlement to such pension or similar retirement remuneration qualified for relief from tax in that State.
- 4
- The provisions of this Article shall also apply in case a lump sum payment is made in lieu of a pension or other similar retirement remuneration.
- 5
- The term “retirement annuity” means a stated sum payable in respect of retirement and paid 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 from funds out of a retirement plan, including a retirement savings plan.
- 6
- Contributions in a year in respect of services rendered in that year paid by, or on behalf of, an individual who exercises employment or self-employment in a Contracting State to a pension fund that is recognised for tax purposes in the other Contracting State shall, during a period not exceeding in the aggregate 60 months, be treated in the same way for tax purposes in the first-mentioned State as a contribution paid to a pension fund that is recognised for tax purposes in that first-mentioned State, if:
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- a)such individual was contributing on a regular basis to the pension fund before that individual became a resident of or temporarily present in the first-mentioned State; and
- b)the competent authority of the first-mentioned State agrees that the pension fund generally corresponds to a pension fund recognised for tax purposes by that State.
- For the purposes of this paragraph, “pension fund” includes a pension plan created under the social security system of a Contracting State.
- 7
- Alimony and other maintenance payments paid to a resident of a Contracting State shall be taxable only in that State. However, any alimony or other maintenance payments paid by a resident of one of the Contracting States to a resident of the other Contracting State, shall, to the extent it is not allowable as a relief to the payer, be taxable only in the first-mentioned State.
- 8
- Where the first-mentioned State in paragraph 1 or 2 applies either of those provisions, the tax rates applicable shall not be higher than those normally imposed on such pension payments on individuals that are residents of that State. However, the Contracting State may take into account other taxable income from sources in that State as well as disallow personal allowances or other deductions or exemptions when calculating the applicable tax rate.
