7. Interest is deemed to be collected in a contracting state when the payer is established in that state for the purposes of his or her tax. However, where the person who pays the interest, whether domiciled in a contracting state or not, has a stable institution in a contracting state where the fault on which the interest is paid was born and the interest is borne by that institution, the interest is deemed to be those of the state where the institution is headquartered. (c) does not meet the requirements of paragraphs (a) or b) of this paragraph, but the competent authority of the first contracting state has, in accordance with the law of that State, that the establishment, acquisition or maintenance of the company which is the economic beneficiary of the dividends and the performance of its activities have not had the primary purpose of obtaining benefits under this agreement. The competent authority of the first contracting state consults with the competent authority of the other contracting state before refusing to grant the benefits covered in this paragraph. 2. States parties agree that the term “permanent establishment” fully encompasses the concept of a “fixed base” used in other double taxation conventions in the context of independent personal services. In addition, the terms of liability apply to interest accrued by a non-resident borrower as a charge of an Australian business resulting from a foreign stable institution of an Australian resident. The withholding tax is deducted from the gross amount of the unpaid dividend. The general withholding rate at source is 30%. However, for dividends paid to residents of countries with dual tax treaty, the treaty rate applies (usually 15% or less). 7.
A business is not considered a stable institution in a contracting state simply because it acts in that state through a broker, a General Commission agent or another agent with an independent function, provided that these agents or agents perform their duties as such in the ordinary activity.