Income Tax Act 2007 section 913

Interpretation of sections 911 and 912

Section 913 defines the key terms "royalty" and "payee" as they are used in the provisions dealing with deduction of income tax at source on royalties under double taxation arrangements.

• A "royalty" is broadly defined to include payments for the use of, or the right to use, intellectual property such as copyrights, patents, trade marks, designs, processes, or information.
• The definition of "royalty" also extends to the proceeds from selling the whole or any part of patent rights.
• The "payee" is the person who is beneficially entitled to the income in respect of which the payment is made, not simply the person who receives the money.
• These definitions apply specifically to the treaty rate deduction rules in section 911 and the power to disapply those rules under section 912.