Royalties and fees for technical services: source taxation permitted with limited withholding, connection to permanent establishment governs allocation. Article 12 allows taxation of royalties and fees for technical services in the recipient's State and also permits source-state taxation with a limited withholding charge where the beneficial owner is a resident of the other Contracting State. It defines royalties (including payments for use of copyrights, patents, trademarks, designs, plans, secret formulas, equipment and technical information) and fees for technical services (managerial, technical or consultancy services, including personnel). Income connected with a permanent establishment or fixed base is taxed under the provisions applicable to business profits or independent personal services, and payments exceeding arm's length due to special relationships are restricted to the arm's length amount under the Article.
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.
Royalties and fees for technical services: source taxation permitted with limited withholding, connection to permanent establishment governs allocation.
Article 12 allows taxation of royalties and fees for technical services in the recipient's State and also permits source-state taxation with a limited withholding charge where the beneficial owner is a resident of the other Contracting State. It defines royalties (including payments for use of copyrights, patents, trademarks, designs, plans, secret formulas, equipment and technical information) and fees for technical services (managerial, technical or consultancy services, including personnel). Income connected with a permanent establishment or fixed base is taxed under the provisions applicable to business profits or independent personal services, and payments exceeding arm's length due to special relationships are restricted to the arm's length amount under the Article.
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