Taxation of shipping profits: exclusive residence-state taxation with limited source-state taxing rights under the treaty. Profits from operating ships in international traffic are taxable only in the enterprise's State of residence, though the State where the operation is carried on may tax those profits subject to a treaty cap. The rule also covers participation in pools, joint businesses and international operating agencies. Where an enterprise is carried on by partners with joint liability and residents in both Contracting States and management is not solely in one State, profits are apportioned and taxed in the partners' resident States. Container rental and related equipment income is included.
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.
Taxation of shipping profits: exclusive residence-state taxation with limited source-state taxing rights under the treaty.
Profits from operating ships in international traffic are taxable only in the enterprise's State of residence, though the State where the operation is carried on may tax those profits subject to a treaty cap. The rule also covers participation in pools, joint businesses and international operating agencies. Where an enterprise is carried on by partners with joint liability and residents in both Contracting States and management is not solely in one State, profits are apportioned and taxed in the partners' resident States. Container rental and related equipment income is included.
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