SCHEDULE AGREEMENT BETWEEN THE GOVERNMENT OF THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND AND THE GOVERNMENT OF THE KINGDOM OF SAUDI ARABIA FOR THE AVOIDANCE ON A RECIPROCAL BASIS OF DOUBLE TAXATION ON REVENUES ARISING FROM THE BUSINESS OF INTERNATIONAL AIR TRANSPORT AND ON THE REMUNERATION OF EMPLOYEES OF ENTERPRISES ENGAGED IN SUCH BUSINESS
ARTICLE 3 (1) Income and profits derived from the operation of aircraft in international traffic by an enterprise of a Contracting State shall not be taxed in the other Contracting State.
(2) The provisions of paragraph (1) of this Article shall also apply to the share of income and profits from the operation of aircraft in international traffic derived by an enterprise of a Contracting State through participation in a pool or a joint business.
(3) For the purposes of this Article the term operation of aircraft shall include:
(a) the transportation by air of persons, baggage, livestock, goods or mail carried on by the owners or lessees or charterers of aircraft including the sale of tickets or similar documentation for such transportation; and
(b) the maintenance of aircraft; and
(c) the rental or incidental lease of aircraft on a charter basis; and
(d) the provision of training schemes and management services directly connected with such transportation.
Interest on funds directly connected with the operation of aircraft in international traffic shall be regarded as income from the operation of such aircraft.
(4) Gains derived by an enterprise of a Contracting State from the alienation of aircraft owned and operated by the enterprise, the income from which is taxable only in that State, and gains from the alienation of movable property used by the enterprise in the operation of such aircraft shall not be taxed in the other Contracting State.