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Note: This Treaty may be impacted by the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS (MLI). MLI impact on Tax Treaties is available with the Orbitax International Tax Research & Compliance Expert.

ARTICLE 23

Elimination of Double Taxation

(1) In Czechoslovakia, double taxation will be avoided in the following manner:

  • (a) Where a resident of Czechoslovakia derives income or owns capital which, in accordance with the provisions of this Convention, may be taxed in Sweden, Czechoslovakia shall, subject to the provisions of sub-paragraph (b) of this paragraph, exempt such income or such capital from tax but may, in calculating tax on the remaining income or capital of that person, apply the rate of tax which would have been applicable if the exempted income or capital had not been so exempted.
  • (b) Czechoslovakia, when imposing taxes on its residents, may include in the tax base the items of income which according to the provisions of Articles 10, 12, 16 and 17 of this Convention may also be taxed in Sweden but shall allow as a deduction from the amount of tax computed on such a base an amount equal to the tax paid in Sweden. Such deduction shall not, however, exceed that part of the Czechoslovak tax, as computed before the deduction is given, which is appropriate to the income which, in accordance with the provisions of Articles 10, 12, 16 and 17 of this Convention may be taxed in Sweden.

(2) In Sweden, double taxation will be avoided in the following manner:

  • (a) Subject to the provisions of sub-paragraph (b) of this paragraph and of paragraph (7) of Article 10, where a resident of Sweden derives income or owns capital which, in accordance with the provisions of this Convention may be taxed in Czechoslovakia, Sweden shall allow:
    • (i) As a deduction from the tax on the income of that person, an amount equal to the income tax paid in Czechoslovakia;
    • (ii) As a deduction from the tax on the capital of that person, an amount equal to the capital tax paid in Czechoslovakia.
  • The deduction in either case shall not, however, exceed that part of the income tax or capital tax, respectively, as computed before the deduction is given, which is appropriate, as the case may be, to the income or the capital which may be taxed in Czechoslovakia.
  • (b) Where a resident of Sweden derives income or owns capital which, in accordance with the provisions of this Convention, shall be taxable only in Czechoslovakia, Sweden may include this income or capital in the tax base but shall allow as a deduction from the income tax or capital tax that part of the income tax or capital tax, respectively, which is appropriate, as the case may be, to the income derived from or the capital owned in Czechoslovakia.