The DBA imposes double taxation when income is taxed in the two contracting states. In the case of resident Singaporen businesses, French tax is allowed for France`s income as a Credit to the Singapore tax due by France, but the credit must not exceed the Singapore portion of the tax, as calculated before the payment of the credit. With regard to dividends paid by a French company to a Singapore-based company directly or indirectly holding a 10% share in the payment of dividends to French companies, Singapore takes into account the corporate tax in France that that company must pay for its income under which the dividend is paid, but the credit must not exceed the portion of Singapore`s taxable tax. , as calculated before credit was granted. In the case of residents of France, Singapore`s income is exempt from French tax, other than dividends, royalties, interest, directors` fees and the income of artists, athletes and artists. France does, however, reserve the right to take into account the income items thus included in setting the resident`s tax rate. The credits are allowed against the French tax levied on the Singapore tax on dividends, interest, royalties, management fees and income of artists and sportsmen. In the event of dividends, the French resident beneficiary must hold at least 10% of the dividend paid by Singapore Company in order to qualify for a loan. The current French tax update will focus on (i) the main features of the new double taxation agreement signed by the People`s Republic of China (China) and France on 26 November 2013 (New DTT), (ii) on the new double taxation agreement signed by Singapore and France on 15 January 2015, (iii) some remarkable court decisions adopted in the last months of 2014. and (iv) the publication of an administrative list of fraudulent and abusive transactions.
In the case of a person established in both countries, his or her tax residence is determined by the location of his permanent residence, but if permanent housing is in either country or in neither country, the centre of vital interest is taken into account. If long-term interest rate factors do not determine where you live, a regular stay is considered. and if the person does not have a habitual residence in both countries, nationality is taken into account; And if the person is a national of either country or one of them, the States Parties determine the place of residence by mutual agreement. The Singapore and France Double Taxation Convention of 2016 provides for a new period during which an office, building or other representative unit of a French or Singaporean company is considered a stable establishment. The new term is 12 months. Service delivery through an office in one state is considered a stable facility when offered for a period of more than 365 days in fifteen months. The Bank deducted the withholding tax levied in Germany on payments made for participatory securities in order to reduce its French corporate tax debt, in accordance with Articles 9 and 20 of the double taxation agreement between France and Germany (the Fra Ger Treaty). The ESTV challenged the tax credit on the basis that participatory securities must be considered as debt securities (particularly on the basis of their terms and conditions) and therefore cannot benefit from Articles 9 to 6 and 20 of the Fra-Ger contract.
Article 4 of the New DTT deals with a text identical to that of the double taxation agreement signed in 2008 by France and the United Kingdom and deals with six specific situations in which the transferred units depend on (i) the source of income, (ii) the location of the business in transit and (iii) the tax recognition of the company for national tax purposes : according to other double taxation agreements recently signed by France, Article 10-6 of the New DTT refuses reduced withholding rates on dividends that are paid on income or real estate profits by vehicles