Explanatory note

The Convention with the Republic of the Ivory Coast is set out in the Schedule to this Order.

The Convention provides for business profits not arising through a permanent establishment to be taxed only in the country of the taxpayer’s residence. Profits attributable to a permanent establishment may be taxed in the country in which the permanent establishment is situated (Articles 5 and 7). Profits arising from the operation of ships and aircraft are to be taxed only in the country in which the place of effective management of the enterprise is situated (Article 8).

Provision is made for income arising from immovable property and gains from the alienation of that property to be taxed in the country in which the property is situated (Articles 6 and 14).

The rate of tax imposed in the country of source on dividends derived by a resident of the other country is not to exceed 15% of the gross amount of the dividends. Where the company paying the dividend is a resident of the Ivory Coast and is exempt from tax on its profits or does not pay tax on its profits at the normal rate, then the rate of tax is not to exceed 18% of the gross amount of the dividends (Article 10).

The rate of tax imposed in the source country on interest is not to exceed 15%. However, the country of source will exempt from tax interest payable to the Government or a local authority of the other country or any agency or instrumentality wholly owned by that Government or local authority (Article 11).

The rate of tax in the source country on royalties flowing to the other country is not to exceed 10% (Article 12).

The rate of tax in the source country on management fees flowing to the other country is not to exceed 10% of the gross amount, but the payee may elect that the tax chargeable on those fees be calculated as if he had a permanent establishment in the source state i.e. net of expenses (Article 13).

The earnings of temporary business visitors are, subject to certain conditions, to be taxed only in the country of the taxpayer’s residence (Articles 15 and 16).

Government service salaries and pensions are normally to be taxed by the paying Government only (Article 20) while other pensions are to be taxed only in the country of the taxpayer’s residence (Article 19). Income derived by artistes and athletes may be taxed in the country where the activities are exercised. Where the activities exercised in one country are supported by public funds of the other country the income is taxable only in that other country (Article 18). Some payments made to visiting students and business apprentices are to be exempt from tax in the country visited (Article 21).

Where income continues to be taxable in both countries credit will be given by the country of the taxpayer’s residence in respect of tax imposed by the other country. The credit to be given in the United Kingdom for tax payable in the Ivory Coast includes credit for tax spared under certain provisions of Ivorian law (Article 23).

There are provisions safeguarding nationals and enterprises of one country against discriminatory taxation in the other country (Article 24) and for consultation and exchange of information between the taxation authorities of the two countries (Articles 25 and 26).

The Convention will enter into force thirty days after the date on which instruments of ratification are exchanged and shall have effect in the calendar year next following that in which the instruments of ratification are exchanged (Article 28).