Business profits allocation: profits taxable where attributed to a permanent establishment subject to separate-enterprise principle and deductions. Profits of an enterprise are taxable only in the State of residence unless attributable to a permanent establishment in the other State; such profits must be determined as those a distinct and separate enterprise would earn under similar conditions. Deductions for expenses incurred for the permanent establishment, including executive and administrative expenses, are allowed subject to the domestic law of the State where the permanent establishment is situated, but inter-office payments (other than reimbursements) by way of royalties, fees, commissions, management charges or, except for banks, interest are generally disregarded for attribution. Apportionment customs, non-attribution for mere purchases, and year-by-year consistency rules apply.
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.
Business profits allocation: profits taxable where attributed to a permanent establishment subject to separate-enterprise principle and deductions.
Profits of an enterprise are taxable only in the State of residence unless attributable to a permanent establishment in the other State; such profits must be determined as those a distinct and separate enterprise would earn under similar conditions. Deductions for expenses incurred for the permanent establishment, including executive and administrative expenses, are allowed subject to the domestic law of the State where the permanent establishment is situated, but inter-office payments (other than reimbursements) by way of royalties, fees, commissions, management charges or, except for banks, interest are generally disregarded for attribution. Apportionment customs, non-attribution for mere purchases, and year-by-year consistency rules apply.
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