ARTICLE 23

Relief from Double Taxation

(1) Tax shall be determined in the case of a resident of the Federal Republic of Germany as follows:

• (a) Unless the provisions of sub-paragraph (b) apply, there shall be excluded from the basis upon which German tax is imposed, any item of income derived from sources within Jamaica and any item of capital situated within Jamaica, which, according to this Agreement, may be taxed in Jamaica. The Federal Republic of Germany, however, retains the right to take into account in the determination of its rate of tax the items of income and capital so excluded. In the case of income from dividends the foregoing provisions shall apply only to such dividends as are paid to a company being a resident of the Federal Republic of Germany by a company being a resident of Jamaica if at least 25 per cent of the voting shares of the Jamaican company is owned directly by the German company. There shall also be excluded from the basis upon which German tax is imposed any shareholding, the dividends of which, if paid, would be excluded from the basis upon which tax is imposed according to the immediately foregoing sentence.
• (b) Subject to the provisions of German tax law regarding credit for foreign tax, there shall be allowed as a credit against German income and corporation tax, including the surcharge thereon, payable in respect of the following items of income derived from sources within Jamaica the Jamaican tax paid under the laws of Jamaica and in accordance with this Agreement on:
  • (aa) dividends not dealt with in sub-paragraph (a) to which sub-paragraph (b), paragraph (2), of Article 10 applies;
  • (bb) interest to which paragraph (2) of Article 11 applies;
  • (cc) royalties to which paragraph (2) of Article 12 applies;
  • (dd) gains to which paragraph (3) of Article 13 applies;
  • (ee) remuneration to which Article 16 applies;
  • (ff) income to which Article 17 applies.
• The credit shall not, however, exceed that part of the German tax, as computed before the credit is given, which is appropriate to such items of income.
• (c) If in the cases (aa), (bb), and (cc) of sub-paragraph (b) above Jamaican tax on dividends, on interest, or on royalties in the meaning of paragraph (3) of Article 12 is wholly relieved or reduced below the rates of tax provided for in Articles 10, 11 or 12, by special incentive measures under Jamaican law designed to promote economic development in Jamaica, there shall be allowed as a credit against German income tax and corporation tax, including the surcharge thereon, on such dividends, interest or royalties an amount corresponding to the rate of tax provided for in the respective Articles. The credit allowed under the foregoing sentence shall, however, not exceed the amount of Jamaican tax which would have been payable but for such reduction.

(2) Subject to the provisions of the law of Jamaica regarding the allowance as a credit against Jamaican tax of tax payable in a territory outside Jamaica (which shall not affect the general principle hereof):

• (a) German tax payable under the laws of the Federal Republic of Germany and in accordance with this Agreement, whether directly or by deduction, on profits or income from sources within the Federal Republic of Germany (excluding in the case of a dividend, tax payable in respect of the profits out of which the dividend is paid) shall be allowed as a credit against any Jamaican tax computed by reference to the same profits or income by reference to which the German tax is computed.
• (b) Where a company which is a resident of the Federal Republic of Germany pays a dividend to a company resident in Jamaica and which controls directly or indirectly at least 25 per cent of the voting shares in the first-mentioned company, the credit shall take into account (in addition to any German tax for which credit may be allowed under sub-paragraph (a) of this paragraph) the German tax payable by that first-mentioned company in respect of the profits out of which such dividend is paid.
• (c) For the purpose of this paragraph the term "German tax" shall not include the Gewerbesteuer (trade tax) computed on a basis other than profits or the Vermogensteuer (capital tax).
• (d) For the purpose of this paragraph, profits or remuneration for personal (including professional) services performed in a Contracting State shall be deemed to be income from sources within that State.