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Unformatted text preview: efits under the Canada-switzerland treaty.
because the “90 percent shareholder group” test should be met, both of the following tests must also be met under article xxix a(4)(a): swissco must either meet the requirements of the qualifying person test or the active trade or business test on the assumption that swissco is resident in the united states, and for purposes of the active trade or business test, the business is carried on in the united states.57
n The rate of Canadian withholding tax on the interest income that would otherwise have been imposed on interest paid by Canco to swissco under the Canada-switzerland treaty is no greater than the rate of tax under the Canadaus treaty.
n regardless of whether swissco meets the requirements of the first condition, the company is subject to withholding tax at a 10 percent rate under the Canadaswitzerland treaty; this clearly is not as low as the 4 percent rate under the Canada-us treaty, which became effective on January 1, 2009.58 The “at least as low”...
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