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CHAPTER I - Scope of the Arrangement
CHAPTER II - Definitions
CHAPTER III - Taxation of Income
CHAPTER IV - Avoidance of Double Taxation
CHAPTER V - Special Provisions
CHAPTER VI - Final Provisions
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 4

Resident

(1) For the purposes of this Arrangement, the term "resident of a country" means any person who, under the laws of that country, is liable to tax therein by reason of his domicile, residence, place of management, place of incorporation or any other criterion of a similar nature. The term "resident of a country" also includes that country and any political subdivision or local authority thereof, and any person established in the Caribbean part of the Netherlands for revenue tax (opbrengstbelasting) purposes.

(2) A person other than an individual shall be deemed to be liable to tax:

  • (a) in the Netherlands: if the person is established in the Netherlands for company tax (vennootschapsbelasting) purposes; or
  • (b) in St. Maarten: if the person is established in St. Maarten for profit tax (winstbelasting) purposes, provided that the income derived by that person is treated under the tax laws of the Netherlands or St. Maarten, as the case may be, as the income of that person and not as the income of its beneficiaries, members or participants.

(3) Notwithstanding the provisions of paragraphs (1) and (2), the term "resident of a country" does not include any person who is liable to tax in that country in respect only of income from sources in that country.

(4) Where by reason of the provisions of paragraph (1) an individual is a resident of both countries, then his status shall be determined as follows:

  • (a) he shall be deemed to be a resident only of the country in which he has a permanent home available to him; if he has a permanent home available to him in both countries, he shall be deemed to be a resident only of the country with which his personal and economic relations are closer (centre of vital interests);
  • (b) if the country in which he has his centre of vital interests cannot be determined, or if he has not a permanent home available to him in either country, he shall be deemed to be a resident only of the country in which he has an habitual abode;
  • (c) if he has an habitual abode in both countries or in neither of them, the competent authorities of the countries shall settle the question by mutual agreement.

(5) Where by reason of the provisions of paragraph (1), a person other than an individual is a resident of both countries, the competent authorities of the countries shall decide by mutual agreement of which country the person is deemed to be a resident for the purposes of this Arrangement. In the absence of such mutual agreement between the competent authorities of the countries, such person shall not be entitled to any benefits arising under this Arrangement, with the exception of Articles 21, 23 and 24.

(6) Where an entity is regarded as transparent for tax purposes by a country and as non-transparent by the another country, and this leads to double taxation or taxation not in accordance with the provisions of this Arrangement, the competent authorities shall enter into a mutual agreement in accordance with the provisions of Article 24 in order to avoid double taxation or taxation not in accordance with the provisions of this Arrangement and, at the same time, to prevent that, merely as a result of the application of this Arrangement, items of income are wholly or partly not subject to tax.

(7) Notwithstanding the provisions of paragraph (6):

  • (a) an item of income derived through a person who is fiscally transparent under the laws of a country shall, for the purposes of this Arrangement, be considered to be derived by a resident of a country to the extent that the item is treated for the purposes of the tax laws of that country as the income of a resident;
  • (b) an item of income considered by a country to be derived by a person who is a resident of that country and considered by the other country to be derived by a person who is a resident of that other country may be taxed in each country as the income of the person considered by that country to have derived the item of income;
  • (c) the competent authority of a country may also grant the benefits of this Arrangement to a resident of the other country in respect of an item of income which, under the laws of that other country, is not treated as income of a resident of that country, provided that such item of income would have been exempt from tax if it had been treated as the income of that resident.