Technical fees withholding: source taxation permitted with a capped levy on payments to the beneficial owner, subject to PE exceptions. Taxation of technical fees permits taxation in both the recipient's residence and the source State, but source state tax on payments to the beneficial owner is capped. Technical fees mean payments (other than to an employee) for technical, managerial or consultancy services. Where the beneficial owner has a permanent establishment in the source State or performs independent personal services there and the fees are effectively connected, rules for business profits or independent services apply. Technical fees arise where the payer is the State or a resident, or where borne by a permanent establishment, and related party excesses are limited to arm's length amounts.
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.
Technical fees withholding: source taxation permitted with a capped levy on payments to the beneficial owner, subject to PE exceptions.
Taxation of technical fees permits taxation in both the recipient's residence and the source State, but source state tax on payments to the beneficial owner is capped. Technical fees mean payments (other than to an employee) for technical, managerial or consultancy services. Where the beneficial owner has a permanent establishment in the source State or performs independent personal services there and the fees are effectively connected, rules for business profits or independent services apply. Technical fees arise where the payer is the State or a resident, or where borne by a permanent establishment, and related party excesses are limited to arm's length amounts.
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