Permanent establishment rules: fixed place or agent activities can create tax nexus, with exclusions for preparatory or auxiliary activities. Defines permanent establishment as a fixed place of business and lists typical forms. Construction, installation or assembly projects and supervisory activities constitute a permanent establishment only if they exceed a prescribed duration. Exclusions cover solely preparatory or auxiliary activities and limited uses of facilities for storage, display, delivery, purchase, collection of information or processing by another enterprise. Agency-based nexus arises where a person habitually concludes contracts, maintains stock for delivery, secures orders, or manufactures/processes on behalf of the enterprise, while agents of independent status acting in the ordinary course are excluded. Insurance enterprises collecting premiums or insuring risks through non-independent persons are deemed to have a permanent establishment. Control between related companies alone is insufficient.
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.
Permanent establishment rules: fixed place or agent activities can create tax nexus, with exclusions for preparatory or auxiliary activities.
Defines permanent establishment as a fixed place of business and lists typical forms. Construction, installation or assembly projects and supervisory activities constitute a permanent establishment only if they exceed a prescribed duration. Exclusions cover solely preparatory or auxiliary activities and limited uses of facilities for storage, display, delivery, purchase, collection of information or processing by another enterprise. Agency-based nexus arises where a person habitually concludes contracts, maintains stock for delivery, secures orders, or manufactures/processes on behalf of the enterprise, while agents of independent status acting in the ordinary course are excluded. Insurance enterprises collecting premiums or insuring risks through non-independent persons are deemed to have a permanent establishment. Control between related companies alone is insufficient.
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