The attribution of the right to tax on different categories of income shall be governed by the DTA. The income which may be taxed in the source State in accordance with the provisions of the DTA may also be taxed in the resident State; however, the resident State shall eliminate double taxation either in accordance with the DTA or its domestic tax laws. Where a resident of a State derives income which, in accordance with the provisions of the DTA, shall be taxable only in the source State or in the resident State, the other State shall exempt such income from taxation.

The determination of the source State referred to in the preceding article shall be governed by the provisions of the DTA; where matters are not provided for in the DTA, the stipulations of the Income Tax Act or relevant provisions of other laws and regulations shall govern.

When a payment that consists of various types of income applies for the provisions of a DTA, these various types of income shall, based on their respective natures, be classified into appropriate income items pursuant to the provisions of such DTA, and the provisions of each identified item of income under that DTA shall govern the relevant applications.

Pursuant to the provisions in association with the term business profits under a DTA, where it illustrates that “where profits include items of income which are dealt with separately in other Articles of this DTA, then the provisions of those Articles shall not be affected by the provisions of this Article,” it shall refer to when an enterprise of the other Contracting State derives income which is subject to income tax in the ROC and that income, in accordance with the provisions of the DTA, falls simultaneously within the scope of the article governing business profits as well as the articles governing other specific items of income, those other articles take priority over the article governing business profits in terms of the application of that case under the DTA.

Pursuant to the provisions in association with the term general definition under a DTA, where it illustrates that “the term enterprise applies to the carrying on of any business” and “the term business includes the performance of professional services and of other activities of an independent character,” and such DTA does not have an article governing independent personal services, these all together shall imply that the provisions in association with the term business profits under such DTA is to govern a case where a resident of the other Contracting State derives income from performing professional services or other activities of an independent character which is subject to income tax in the ROC.