Associated enterprises adjustment reallocates profits when intercompany conditions depart from arm's length, permitting corresponding tax adjustments. Where related enterprises set intercompany conditions different from those between independent enterprises, profits that would have accrued but for those conditions may be included in the taxable profits of the affected enterprise and taxed. If such profits are taxed by one territory although taxed in the other, that other territory shall make an appropriate corresponding adjustment, with due regard to the agreement and consultation between competent authorities to avoid double taxation.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Associated enterprises adjustment reallocates profits when intercompany conditions depart from arm's length, permitting corresponding tax adjustments.
Where related enterprises set intercompany conditions different from those between independent enterprises, profits that would have accrued but for those conditions may be included in the taxable profits of the affected enterprise and taxed. If such profits are taxed by one territory although taxed in the other, that other territory shall make an appropriate corresponding adjustment, with due regard to the agreement and consultation between competent authorities to avoid double taxation.
Full Summary is available for active users!
Note: It is a system-generated summary and is for quick reference only.
TaxTMI 
of 
Join Channel
TaxTMI 
