Tax treaty between Japan and Saudi Arabia: effective from January 2012

Signed on 15 November 2010 in Tokyo, the tax agreement between Saudi Arabia and Japan entered into force on 1 September 2011. Its provisions are effective from 1 January 2012.

The main provisions are:

Permanent establishment

The term “permanent establishment” is defined as a fixed place of business through which the business of an enterprise is wholly or partly carried on.

The term “permanent establishment” also includes:

• a building site, a construction, assembly or installation project or supervisory activities in connection therewith, but only if such site, project or activities last more than 183 days; and

• the furnishing of services, including consultancy services, by an enterprise through employees or other personnel engaged by the enterprise for such purposes, but only if activities of that nature continue (for the same or a connected project) within a contracting state for a period or periods aggregating more than 183 days within any twelve month period.

Dividends