Associated enterprises rules allow reallocation of profits where related-party conditions differ from independent transactions, requiring reciprocal tax adjustments. Associated enterprises rules permit inclusion in an enterprise's taxable profits of amounts that would have accrued but for non-arm's-length conditions between related enterprises, applying the independent enterprise standard. When one State taxes such adjusted profits, the other State is obliged to make an appropriate corresponding adjustment to the tax charged on those profits, with competent authorities consulting each other and having regard to other Convention provisions to determine appropriate relief.
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 rules allow reallocation of profits where related-party conditions differ from independent transactions, requiring reciprocal tax adjustments.
Associated enterprises rules permit inclusion in an enterprise's taxable profits of amounts that would have accrued but for non-arm's-length conditions between related enterprises, applying the independent enterprise standard. When one State taxes such adjusted profits, the other State is obliged to make an appropriate corresponding adjustment to the tax charged on those profits, with competent authorities consulting each other and having regard to other Convention provisions to determine appropriate relief.
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