Alison Lobb (Deloitte) considers the permanent establishment threshold and the consequences for cross-border trading.
On 5 October 2015 the
OECD Secretariat issued a final report on preventing artificial avoidance of permanent establishment (PE) status (Action 7 of the BEPS Action Plan). This considers the important boundary for allocating taxing rights for business (trading) activities to different jurisdictions. The report builds on proposals put forward in earlier discussion drafts and sets out changes to update the definition of PE in Article 5 of the OECD Model Tax Convention and its associated Commentary. The report was approved by the G20 finance ministers in Lima Peru on 8 October and will be put to the G20 leaders in Ankara Turkey in November.
The changes agreed under the BEPS project amend the thresholds for both...
