The income and capital tax treaty between Comoros and the UAE entered into force on 2 January 2018. The treaty, signed 26 March 2015, is the first of its kind between the two countries.
The treaty covers Comoros income tax, corporate tax, and capital gains tax and covers UAE income tax and corporate tax.
Article 3 (Income from Hydrocarbons) provides that the treaty will not affect the right of either one of the Contracting States to apply their domestic laws and regulations related to the taxation of income, profits, and capital derived from hydrocarbons and its associated activities situated in the territory of the respective Contracting State.
The treaty includes the provision that a permanent establishment will be deemed constituted if an enterprise furnishes services through employees or other engaged personnel in a Contracting State and the activities continue for a period or periods aggregating more than 6 months.
The following capital gains derived by a resident of one Contracting State may be taxed by the other State:
Gains from the alienation of other property by a resident of a Contracting State may only be taxed by that State.
Both countries apply the credit method for the elimination of double taxation.
The treaty applies from 1 January 2019.
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