BEPS, EU/EEA, Hybrids, OECD, Permanent Establishments, State Aid, Tax Avoidance, Tax Planning, Tax Policy

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Tax practitioner’s in the northern hemisphere taking their summer holidays may well have included the OECD discussion draft of 5 July 2016 on the attribution of profits to permanent establishments as part of their holiday reading (a mere 40 pages). See post on July 21, 2016. Over 50 organisations and individuals submitted comments(published by the…

BEPS, FATCA, OECD, Tax Policy

(Temple Tax Chambers; King’s College London)/ /2 Comments

A thought-provoking and insightful series of papers on taxpayer rights have just been published in the latest edition of The Tax Lawyer,[1] published by the American Bar Association Section of Taxation. These papers were presented at the inaugural International Conference on Taxpayer rights held in Washington, DC in November 2015, initiated by Nina Olson, National…

BEPS, OECD, Permanent Establishments, Tax Planning, Tax Policy, Tax Treaties, Transfer Pricing, United Nations

(Temple Tax Chambers; King’s College London)/ /1 Comment

The attribution of profits to a permanent establishment is already a complex issue with at least three separate regimes in the tax treaty context- the OECD Authorised Approach under the 2010 OECD version of Article 7 of the OECD Model, the AOA subject to limitations required by the pre-2010 version and that permitted by Article…

Brexit, Customs and Excise, EU/EEA, Tax Policy, Tax Treaties, VAT, Withholding Taxes

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When UK voters went to the polls on 23 June 2016 and voted by a slim majority to leave the European Union, few of them had in mind the impact on taxation.  Future generations are unlikely to view it kindly. Looked at from the present the dominating features are uncertainty and disruption of settled tax…

BEPS, OECD, Tax Planning, Tax Treaties

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George Orwell’s parable, Animal Farm, offers insights on political and governmental institutions that bear revisiting from time to time. BEPS Action 6 with the broad title “Prevent treaty abuse” has among its objectives “developing model treaty provisions to prevent the granting of treaty benefits in inappropriate circumstances” and “to clarify that tax treaties are not…

BEPS, MAPs and APAs, OECD, Tax Planning, Tax Treaties, Transfer Pricing, United Nations

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The OECD BEPS project was kicked off by the observation that the interaction of domestic tax systems sometimes leads to an overlap, resulting in double taxation as well as gaps, which result in an item of income not being taxed anywhere, thus resulting in so called “double non-taxation”. Co-operation among countries historically addressed double taxation…

BEPS, Intangibles, OECD, Permanent Establishments, Tax Avoidance, Tax Policy, Tax Treaties, United Nations, Withholding Taxes

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Model tax treaties do matter. The OECD and UN Models constitute precedent books with standard clauses that contracting states can follow or adapt to suit their particular circumstances. The US Model treaty, in contrast, is a statement of intent. The preamble to the revised 2016 US Model Income Tax Convention released by the US Treasury…

BEPS, OECD, Permanent Establishments, Tax Treaties, United Nations

(Temple Tax Chambers; King’s College London)/ /1 Comment

Interest and penalty regimes place a high premium on correctly identifying the existence of a permanent establishment in the territory of a state. The failure to do so often means that there is no reporting to the tax administration by the foreign enterprise by way of registration or filing of returns. This is particularly true…

BEPS, OECD, Permanent Establishments, Tax Treaties, United Nations

(Temple Tax Chambers; King’s College London)/ /2 Comments

The Spanish National Court has recently ruled (case no. 182/2012) that a Spanish affiliate of Dell that sold Dell computers in Spain under a commissionaire agreement with Dell Ireland constituted a permanent establishment of the Irish group sales company. The decision is in line with earlier Spanish Supreme Court Decisions in Roche Vitamins Europe SA…

BEPS, OECD, Tax Avoidance, Tax Planning, Tax Policy, Transfer Pricing

(Temple Tax Chambers; King’s College London)/ /1 Comment

The longstanding view on application of the arm’s length principle is that it is generally based on a comparison of the conditions in a controlled transaction with the conditions in transactions between independent enterprises. A transaction, for this purpose, almost always involves a contract. This is because a contract, whether made in writing, orally or…

BEPS, OECD, Tax Policy

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Everyone concerned with international taxation awaits the publication of the final package of BEPS measures by the OECD on Monday 5 October 2015. While the BEPS programme addresses disparities between national tax systems and features of international tax rules that have allowed some multinational companies to enjoy very low effective corporate tax rates, it is…

Arbitration, BEPS, Hybrids, MAPs and APAs, OECD, Tax Avoidance, Tax Policy, Tax Treaties

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In many respects a multilateral tax treaty represents an utopian view of international tax law: a wide consensus among nation states to submit themselves to a common set of rules that govern the levying of taxes across national boundaries. While there have been several examples of attempts at multilateral double taxation treaties, such as the…

OECD, Permanent Establishments, Tax Treaties, United Nations

(Temple Tax Chambers; King’s College London)/ /4 Comments

The services permanent establishment concept is perhaps the most noteworthy contribution to tax treaties provided by the UN model. The tax treaty concluded by South Africa and the United States in 1997, to replace the one terminated during the apartheid era, has provided an opportunity to consider thorny questions of services and permanent establishments. The…

BEPS, Hybrids, OECD, Tax Treaties

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This week, the United Kingdom Supreme Court, in a landmark decision, has ruled that a UK resident individual member of a Delaware limited liability company is entitled to credit in the UK for US tax on the profits of the LLC. Anson v Commissioners for Her Majesty’s Revenue and Customs [2015] UKSC 44 has rejected…