Commission taxation: source-state may tax commissions paid to nonresidents, subject to a limited source-state tax cap. Commission paid to a resident of the other Contracting State may be taxed in the resident State, but may also be taxed in the State where it arises subject to a source state tax limitation of 5 per cent of the commission; competent authorities shall agree the mode of applying this limitation. The limitation does not apply if the recipient has a permanent establishment in the State where the commission arises and the commission is effectively connected with that permanent establishment, in which case Article 7 applies.
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.
Commission taxation: source-state may tax commissions paid to nonresidents, subject to a limited source-state tax cap.
Commission paid to a resident of the other Contracting State may be taxed in the resident State, but may also be taxed in the State where it arises subject to a source state tax limitation of 5 per cent of the commission; competent authorities shall agree the mode of applying this limitation. The limitation does not apply if the recipient has a permanent establishment in the State where the commission arises and the commission is effectively connected with that permanent establishment, in which case Article 7 applies.
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