Special Features of the UN Model Convention

1. S. 392Introduction

The taxation of pensions is a complex topic because aims like the neutrality of the cross-border flow of workers as well as the prevention of double taxation must be considered. Issues of double taxation not only geographically but also temporally have to be covered by the relevant provisions. The following paragraphs will give an overview of the two versions of Article 18 provided by the UN Model Convention. Afterwards, issues like the scope of payments regarding Article 18 will be addressed: cross-border issues related to pensions and payments made within the framework of a public scheme which is part of a social security system, a political subdivision or a local authority thereof. Finally, an overview of the application of Article 18 of the UN Model Convention in actual treaties will be given.

2. The Allocation Rules of Article 18 of the UN Model Convention

In contrast to the OECD Model Convention, the UN Model Convention provides for two different versions of article 18. Article 18 A) will be evaluated in section 2.1. and 2.2. and article 18 B) will be further evaluated in section 2.3.

Both versions of the UN Model have in common not only provisions regarding pensions but also...