background image
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.

PROTOCOL

At the signing today of the Convention between the Principality of Liechtenstein and the Republic of San Marino for the avoidance of double taxation with respect to taxes on income and on capital, the undersigned have agreed upon the following provisions, which shall form an integral part of this Convention:

(1) With respect to paragraph (1) of Article 4 it is understood that investment funds or schemes constituted under the law of, and established in, a Contracting State which, irrespective of whether they are bodies corporate under that law:

  • (a) receive income arising in the other Contracting State;
  • (b) are not treated as bodies corporate for the purpose of taxing that income in the Contracting State under the law of which they are constituted; and
  • (c) are not subject to tax on that income in that State;

shall be treated for the purposes of this Convention as:

  • (a) residents of the State in which they are established; and
  • (b) beneficial owners of the aggregate amount of that income on which individuals and bodies corporate, who are residents of that or any further Contracting State, are subject to tax therein.

The extent of Convention benefits is to be determined by the extent of Convention benefits residents of that or any further Contracting State participating in the investment fund or scheme are entitled to.

For the purposes of this paragraph:

  • (a) "investment fund or scheme" means, in the case of Liechtenstein, an "Investment-unternehmen" within the meaning of the "Gesetz über Investmentunternehmen (IUG)" of 19 May 2005, LGBl. 2005, No. 156, and, in the case of San Marino, an "Fondo comune di investimento" within the meaning of the "Legge sulle imprese e sui servizi bancari e assicurativi" of 17 November 2005 N.165 and by "Regolamento in materia di servizi di investimento collettivo" N. 2006?3 of Republic of San Marino Central Bank;
  • (b) "further Contracting State" means each State which the other Contracting State has concluded a Convention for the avoidance of double taxation with respect to taxes on income and on capital with;
  • (c) a "resident participating in the investment fund or scheme" means a resident who is entitled to participate in or receive profits or income from the acquisition, holding, management or disposal of any part of the property (including money), which is subject to the arrangements constituting the investment fund or scheme, or sums paid out of such profits or income.

(2) With respect to paragraph (1) of Article 4, it is understood that pension schemes constituted under the law of and established in, a Contracting State which, irrespective of whether they are bodies corporate under that law:

  • (a) receive income arising in the other Contracting State; and
  • (b) are exempt from income taxation under the law of the State in which they are constituted,  

shall be treated for the purposes of this Convention as:

  • (a) residents of the State in which they are established; and
  • (b) beneficial owners of the aggregate amount of that income on which individuals and bodies corporate, who are residents of that or any further Contracting State, are subject to tax therein.

The extent of Convention benefits is to be determined by the extent of Convention benefits of residents of that or any further Contracting State beneficially owning an interest in the pension scheme.

For the purposes of this paragraph:

  • (a) "pension scheme" means, in the case of Liechtenstein, any arrangement within the meaning of the "Gesetz über die betriebliche Pensionsvorsorge (BPVG)" of 20 October 1987, LGBl. 1988, No. 12, (including the associated regulations) and, in the case of San Marino any arrangement within the meaning of the "Legge di Riforma del Sistema Previdenziale" of 8 November 2005 N.157 and subsequent amendments and integrations;
  • (b) "further Contracting State" means each State which the other Contracting State has concluded a Convention for the avoidance of double taxation with respect to taxes on income and on capital with;
  • (c) a "resident beneficially owning an interest in the pension scheme" means a resident for whose benefit pensions or retirement benefits are administered or provided or income is earned.

(3) With respect to paragraph (1) of Article 4, it is understood that persons other than individuals established in a Contracting State which, irrespective of whether they are bodies corporate under that law:

  • (a) receive income arising in the other Contracting State;
  • (b) solely and irrevocably serve charitable, cultural or idealistic purposes on a not-for-profit basis; and
  • (c) are exempt from income taxation by reason of their nature as such under the law of the Contracting State in which they are established;

shall be treated for the purposes of this Convention as residents of the State in which they are established.

(4) With respect to paragraph (1) of Article 4, it is understood that persons other than individuals established in a Contracting State which, irrespective of whether they are bodies corporate under that law:

  • (a) receive income arising in the other Contracting State;
  • (b) are not treated as bodies corporate for the purpose of taxing that income in the Contracting State under the law of which they are constituted; and
  • (c) are not subject to tax on that income in that State;

shall be treated for the purposes of this Convention as:

  • (a) residents of the Contracting State in which they are established; and
  • (b) beneficial owners of the aggregate amount of that income on which individuals and bodies corporate, who are residents of that or any further Contracting State, are subject to tax therein.

The extent of Convention benefits is to be determined by the extent of Convention benefits of residents of that or any further Contracting State who are participating in or beneficial owners of the person other than an individual.

For the purposes of this paragraph "further Contracting State" means each State which the other Contracting State has concluded a Convention for the avoidance of double taxation with respect to taxes on income and on capital with.