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Key Points of the Tax Agreement between Japan and Brunei Darussalam

[Provisional translation]


  • (1) Clarification of taxable scope in the partner country where enterprises carry on businesses
    If a Japanese company establishes a permanent establishment (branch, etc.) and conducts business activities in Brunei Darussalam, only business profits resulting from business activities carried out through the permanent establishment is to be subject to tax in Brunei Darussalam.

  • (2) Reduction of taxation on Investment Income (Dividends, Interest and Royalties) in the source country

    • (1) Dividends (Article 10)
      The maximum tax rate for dividends in the source country is stipulated as below:

      • (i) Between parent and subsidiary companies (Shareholding ratio: at least 10%): 5%

      • (ii) Others: 10%

    • (2) Interest(Article 11)

      • (i) The maximum tax rate for interest in the source country is 10%.

      • (ii) Interest received by specific governmental institutions are to be exempted from taxes in the source country.

    • (3) Royalties (Article 12)
      The maximum tax rate for royalties in the source country is 10%.


      • ”Source country” means a country where the income arises.
      • ”Maximum tax rate” means the upper limit of taxation (a tax rate) in the source country.
  • (3) Others
    In line with the provisions of recent international model tax convention and our country’s tax conventions with other countries, following provisions, in addition to the above, are stipulated:

    • (1) Mutual Agreement Procedure between tax authorities (Article 24)

    • (2) Exchange of Information on taxes between the tax authorities (Article 25)