Elimination of Double Taxation in the State of Residence
(1) Subject to the provisions of German tax law regarding credit for foreign tax, there shall be allowed as a credit against German tax payable in respect of income or capital which, according to this Agreement, may be taxed in Cyprus, the Cyprus tax paid under the laws of Cyprus and in accordance with this Agreement.
(2) Where in accordance with any provisions of the Agreement income derived or capital owned by a resident of Germany is exempt from tax in Germany, Germany may nevertheless in calculating the amount of tax on the remaining income or capital of such resident, take into account the exempted income or capital.
(3) Tax shall be determined in the case of a resident of Cyprus as follows:
- Subject to the provisions of Cyprus tax law regarding credit for foreign tax, there shall be allowed as a credit against Cyprus tax payable in respect of any item of income derived from Germany or capital owned in Germany the tax paid under the laws of Germany and in accordance with this Agreement. The credit shall not, however, exceed that part of the Cyprus tax, as computed before the credit is given which is appropriate to such items of income or capital.