62 STAT.] NETHERLANDS-DOUBLE TAXATION-APR. 29, 1948 amount to be paid in settlement of such liability shall not exceed the amount of the liability which would have been determined if (a) the United States Revenue Act of 1936 (except in the case of a Netherlands corporation in which more than 50 percent of the entire voting power was controlled, directly or indirectly, throughout the latter half of the taxable year, by citizens or resi- dents of the United States), and (b) Articles XII and XIII of the present Convention, had been in effect for such year. If the taxpayer was not, within the meaning of such Revenue Act, engaged in trade or business in the United States and had no office or place of business therein during the taxable year, the amount of interest and penalties shall not exceed 50 percent of the amount of the tax with respect to which such interest and penalties have been computed. (2) The United States income tax unpaid on the effective date of the present Convention for any taxable year beginning after December 31, 1935 and prior to the effective date of the present Convention in the case of an individual (other than a citizen of the United States) resident of the Netherlands, or in the case of any Netherlands corpo- ration, shall be determined as if the provisions of Articles XII and XII of the present Convention had been in effect for such taxable year. (3) The provisions of paragraph (1) of this Article shall not apply (a) unless the taxpayer files with the Commissioner of Internal Revenue within a period of two years following the effective date of the present Convention a request that such tax liability be so adjusted and furnishes such information as the Commissioner may require; or (b) in any case in which the Commissioner is satisfied that any deficiency in tax is due to fraud with intent to evade the tax. ARrTILE XV (1) Wages, salaries and similar compensation, and pensions and life annuities, paid either directly by, or from funds created by, one of the Contracting States or the political subdivisions or territories thereof to individuals in the other Contracting State shall be exempt from taxation in the latter State. (2) Private pensions and life annuities derived from within one of the Contracting States and paid to individuals in the other Con- tracting State shall be exempt from taxation in the former State. (3) The term "pensions" as used in this Article means periodic payments made in consideration for services rendered or by way of compensation for injuries received. (4) The term "life annuities" as used in this Article means a stated sum payable periodically at stated times during life, or during a specified number of years, under an obligation to make the payments in return for adequate and full consideration in money or money's worth. 1763 49 Stat. 164 . emWps, etc., ta ex- emption. Pensions and life annuities.
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