The Schedule to the Order contains a protocol (“the Protocol”) which amends an agreement in relation to the territory of Taiwan dealing with the elimination of double taxation with respect to capital gains tax, corporation tax and income tax, the prevention of tax avoidance and evasion, and international tax enforcement (“the Agreement”). The Order brings the Protocol into effect.

The Agreement was scheduled to the Double Taxation Relief (Taxes on Income) (Taiwan) Order 2002 (S.I. 2002/3137).

The Agreement aims to eliminate the double taxation of income and gains arising in one territory and paid to residents of the other territory. This is done by allocating the taxing rights that each territory has under its domestic law over the same income and gains, and by providing relief from double taxation. There are also specific measures which combat discriminatory tax treatment and provide for assistance in international tax enforcement. The Protocol continues this approach.

Article 1 of the Order provides for citation and article 2 of the Order makes a declaration as to the effect and content of the Protocol.

Amendments are made to the title of, and the preamble to, the Agreement and the Articles of the Agreement relating to persons covered, taxes covered, general definitions, residence, dividends, interest, royalties, capital gains, limitation of relief, non-discrimination, mutual agreement procedure and exchange of information. An Article relating to entitlement to benefits is added to the Agreement.

The Protocol will enter into force on the date of the later of the notifications by each territory of the completion of its legislative procedures, and will take effect in each territory in accordance with paragraph 2 of Article XVIII of the Protocol.

The date of entry into force will, in due course, be published in the London, Edinburgh and Belfast Gazettes.

A Tax Information and Impact Note has not been produced for the Order as it gives effect to a double taxation agreement. Double taxation agreements impose no obligations on taxpayers, rather they seek to eliminate double taxation and fiscal evasion.