Lithuania-Belgium

Article 23

ELIMINATION OF DOUBLE TAXATION

1. In the case of Lithuania, double taxation shall be avoided as follows:

where a resident of Lithuania derives income which, in accordance with this Convention, may be taxed in Belgium, unless a more favorable treatment is provided in its domestic law, Lithuania shall allow as a deduction from the tax on the income of that resident, an amount equal to the income tax paid thereon in Belgium.

Such deduction shall not, however, exceed that part of the income tax in Lithuania, as computed before the deduction is given, which is attributable to the income which may be taxed in Belgium.

2. In the case of Belgium, double taxation shall be avoided as follows:

1. Where a resident of Belgium derives income which is taxed in Lithuania in accordance with the provisions of this Convention, other than those of paragraph 2 of Article 10, of paragraphs 2 and 7 of Article 11 and of paragraphs 2 and 6 of Article 12, Belgium shall exempt such income from tax but may, in calculating the amount of tax on the remaining income of that resident, apply the rate of tax which would have been applicable if such income had not been exempted.
2. Subject to the provisions of Belgian law regarding the deduction from Belgian tax of taxes paid abroad, where a resident of Belgium derives items of his aggregate income for Belgian tax purposes which are dividends taxable in accordance with paragraph 2 of Article 10, and not exempt from Belgian tax according to sub­paragraph c) hereinafter, interest taxable in accordance with paragraph 2 or 7 of Article 11, or royalties taxable in accordance with paragraph 2 or 6 of Article 12, the Lithuanian tax levied on that income shall be allowed as a credit against Belgian tax relating to such income.
3. Dividends within the meaning of paragraph 3 of Article 10, derived by a company which is a resident of Belgium from a company which is a resident of Lithuania, shall be exempt from the corporate income tax in Belgium under the conditions and within the limits provided for in Belgian law.
4. Where, in accordance with Belgian law, losses incurred by an enterprise carried on by a resident of Belgium in a permanent establishment situated in Lithuania, have been effectively deducted from the profits of that enterprise for its taxation in Belgium, the exemption provided for in sub-paragraph a) shall not apply in Belgium to the profits of other taxable periods attributable to that establishment to the extent that those profits have also been exempted from tax in Lithuania by reason of compensation for the said losses.