Zambia Botswana DTA

Signed on:                                 9^th March 2015

Came into force on:             14^th August 2015

Effective in Zambia on:      1^st April 2016

Effective in Botswana on:  1^st July 2016

Definitions:

1. Source Country means the country where income is being derived
2. Residence Country means the country where the person who is deriving income is resident
3. Permanent Establishment means a fixed place of business which gives rise to income tax liability

Class of Income		Taxation and profit determination rules
1.	Immovable property	Source country may tax
2.	Business Profits	Source country may tax if permanet establishment exists, to the extyent that the income is attributable to the permanent establishment Royalties, Management consultancy fees, other fees from head office not deductible Bank interest may be deducted
3.	International Transport Services	Country of effective management may tax I effective management is on a boat or ship, country of home harbor may tax If no harbor exists, then residence country may tax
4.	Associated or Related Businesses	Open market prices must be used for determination of profits Transfer pricing adjustments may be made should where necessary
5.	Dividends	Residence country may tax Source Country may tax: Up to 5% if recipient is a company that holds at least 25% shares in the company that is paying Up to 7% if not Source country may tax if payment is made from profits of a permanent establishment that is situated in source country
6.	Interest	Residence country may tax Source Country may tax up 10% Exempt if recipient is government Source country may tax if interest is associated with the permanent establishment in the source country
7.	Royalties	Residence country may tax Source Country up 10% Exempt if recipient is government Source country may tax if royalties are associated with the permanent establishment in the source country
8.	Technical Fees	Residence country may tax Source Country may tax up 10% Exempt if recipient is government Source country may tax if technical fees are associated with the permanent establishment in the source country
9.	Capital Gains	Source country may tax if shares derive their value from immovable property that is situated in the source country
10.	Employment	Source country may tax if employment is exercised in source country for e period exceeding 183 days in a tax year. Resident country may tax in the case of international transport services
11.	Directors Fees	Residence country may tax
12.	Entertainers and Sports Persons	Source country may tax Exempt if event is sponsored by other treaty country’s government or public funds
13.	Pensions and annuities	Source country may tax
14.	Government Services	Source country may tax
15.	Students, Apprentices and Business Trainees	Exempt on source country
16.	Other Income	Resident country may tax
17.	Capital	Source country may tax capital income from immovable property Country of effective management may tax is transport business