Royalties and technical service fees: source taxation rules and residence-state taxation with limited tax for beneficial owners. The Article permits taxation of royalties and fees for technical services in both the source State and the resident State, subject to a limited tax where the beneficial owner is resident in the other Contracting State. It sets source rules deeming income to arise where the payer is resident or where a payer's permanent establishment or fixed base incurs the liability, and deems income to arise in the State where use, rights or services relate. Definitions specify royalties (including copyrights, software, patents, equipment, and technical information) and fees for technical services (managerial, technical or consultancy services). Special relationship adjustments limit Article application to arm's length amounts; excess remains taxable under domestic law.
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Provisions expressly mentioned in the judgment/order text.
Royalties and technical service fees: source taxation rules and residence-state taxation with limited tax for beneficial owners.
The Article permits taxation of royalties and fees for technical services in both the source State and the resident State, subject to a limited tax where the beneficial owner is resident in the other Contracting State. It sets source rules deeming income to arise where the payer is resident or where a payer's permanent establishment or fixed base incurs the liability, and deems income to arise in the State where use, rights or services relate. Definitions specify royalties (including copyrights, software, patents, equipment, and technical information) and fees for technical services (managerial, technical or consultancy services). Special relationship adjustments limit Article application to arm's length amounts; excess remains taxable under domestic law.
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