INTERNATIONAL TAX PLAZA - Article 17, Paragraph 2

Details: Published: 18 February 2022

Where a constituent entity meets the definition of a permanent establishment in Article 3, point (10)(a) or (b), its financial accounting net income or loss shall be adjusted to reflect only the items of income and expense that are attributable to it in accordance with the applicable tax treaty or domestic law of the jurisdiction where it is located, regardless of the amount of income subject to tax and the amount of deductible expenses in that jurisdiction.

Where a constituent entity meets the definition of a permanent establishment in Article 3, point (10)(c), its financial accounting net income or loss shall be adjusted to reflect only the items of income and expense that would have been attributable to it in accordance with Article 7 of the OECD Model Tax Convention.

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