What Is the United Nations Model Convention?
The United Nations Model Convention is a United Nations template for bilateral double tax treaties, which gives greater weight to source-country taxing rights.
Also known as: UN Model, UN Model Double Taxation Convention.
How United Nations Model Convention works
The United Nations Model Convention is a non-binding model text which countries use when negotiating double tax treaties, especially between developed and developing countries, and which generally preserves more taxing rights for the source country, where income arises, than the OECD Model Convention does. The 2017 Update states the aim of eliminating double taxation without creating opportunities for non-taxation through avoidance or treaty shopping. Some withholding percentages, such as dividend rates, are left to bilateral negotiation. Only the treaty actually signed and ratified binds the parties.
United Nations Model Convention vs OECD Model Convention
Unlike the OECD Model, which tends to favour residence-country taxation, the United Nations Model Convention retains broader source-country rights, for example on services and certain business profits.
Example
Illustrative example: Country A and Country B negotiate a treaty using the UN Model as a base. The final text lets Country A, as source country, tax fees for services performed locally beyond a stated period, which an OECD-based text might leave to the residence country.
Common misconception
Myth: The UN Model applies directly to any cross-border income.
Reality: The United Nations Model Convention is only a template, so rights and rates depend on the specific bilateral treaty which two countries have signed and ratified.
Frequently asked questions
How does the UN Model differ from the OECD Model?
The United Nations Model Convention generally gives more taxing rights to the source country, while the OECD Model Convention tends to favour the residence country, especially for business profits, services and passive income.
Is the UN Model legally binding?
The United Nations Model Convention is not legally binding; only bilateral treaties based on it bind the contracting states, and commentary on the model serves as an interpretive aid.
Related terms
- OECD Model Convention — Main alternative treaty template
- Double Tax Treaty (DTT) — Binding instruments drafted from the model
- Source Taxation — Principle the UN Model emphasises
- Treaty Resident — Status defined in the model's residence article
- Independent Personal Service — Treaty income category retained as Article 14
Related guides
- Tax treaties and international taxation — Overview of tax treaties and model conventions
Sources
Last verified: 2026-10-09. This entry is general information, not tax or legal advice; rules vary by country and change over time.
