BEPS action 7: Preventing the artificial avoidance of PE status
Tax Analysis: October 15, 2015/China
As part of the 2015 output, the OECD issued a final report in relation to preventing the artificial avoidance of permanent establishment (PE) status (action 7), which introduces changes to the model treaty. (Tax Analysis:October 15, 2015/China)
The report builds on proposals put forward in the G20/OECD’s discussion drafts from October 2014 and May 2015 and updates the definition of PE (taxable presence) in article 5 of the OECD model tax treaty and associated commentary.
This newsletter explains the following topics;
- Proposals for amendments to article 5 of the OECD model tax treaty
- Profit attribution to PEs and interaction with action points on transfer pricing
- Deloitte’s Comments and business next steps
The China Tax Desk offers a wide range of advisory and other services tailored to suit each client’s needs to resolve various tax issues faced in its Chinese business. We work in close collaboration with Deloitte China to support Japanese companies operating in China.
In the globalized economy, transfer pricing has become a leading risk management issue for multinational businesses. Our transfer pricing professionals can assist you with efficiently managing your transfer pricing to minimize assessment risk and avoid costly defense actions.