Royalties and technical service fees may be taxed in the source state, subject to a source-state withholding cap. Royalties and fees for technical services arising in one Contracting State and paid to a resident of the other may be taxed in the recipient's State of residence, but may also be taxed in the State where they arise; if the beneficial owner is resident of the other State the source tax shall not exceed 20% of the gross amount. Definitions: 'royalties' cover payments for use of copyrights, films, patents, trademarks, designs, plans, secret formulas, equipment and technical information; 'fees for technical services' cover managerial, technical or consultancy services and provision of technical personnel, excluding employee remuneration and specified independent personal services. Special rules apply where amounts are effectively connected with a permanent establishment or fixed base, and related-party excess amounts are limited to arm's-length values.
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 technical service fees may be taxed in the source state, subject to a source-state withholding cap.
Royalties and fees for technical services arising in one Contracting State and paid to a resident of the other may be taxed in the recipient's State of residence, but may also be taxed in the State where they arise; if the beneficial owner is resident of the other State the source tax shall not exceed 20% of the gross amount. Definitions: "royalties" cover payments for use of copyrights, films, patents, trademarks, designs, plans, secret formulas, equipment and technical information; "fees for technical services" cover managerial, technical or consultancy services and provision of technical personnel, excluding employee remuneration and specified independent personal services. Special rules apply where amounts are effectively connected with a permanent establishment or fixed base, and related-party excess amounts are limited to arm's-length values.
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