Worried for the exam? No time to prepare well structured notes to bring with you? No problem. These schemes are intended to provide a step-by-step approach to each and every topic covered. They will enable you to save time and answer comprehensively to all exam questions. They combine: (i) lecture ...
Triangulation Schemes for dividends, interest and royalties
Art. 24(3)
1) Situation of a PE in the same member State of the payer
Facts
ACo distributes dividend/interest/royalty to BCo (attributable to a PE in State A)
BCo is the beneficial owner of the income (dividend, interest or royalty)
Situation treated in ph. 62-66 of Commentary on Art. 24
DTC – tax treaty rules
Perspective of the Source State (A)
DTC between A-B applicable (Art. 1 and 4 fulfilled + Art. 2)
NO limits to impose WHT (ph. 63 on Art. 24), in case of…
Dividends - Art. 10(4) overrides the WHT limits of Art. 10(2) - ph. 31 on Art. 10
Interest – Art. 11(4) overrides the WHT limits of Art. 11(2) – ph. 24 on Art. 11
Royalties – Art. 12(4) overrides the rule of Art. 12(1) – ph. 20 on Art. 12
Perspective of the Residence State (B)
Following the throwback rules of Art. 10(4), Art. 11(4), Art. 12(4) – Art. 7 applies!
Following Art. 7(2) of the DTC between A-B:
Dividend/interest/royalty shall not be taxed by B (since are attributable to
the PE in State A)
Income of BCo in the PE State (including the div/int/roy) should be taxable
by A – double taxation?!
The residence state provides relief under Art. 23A/B
Application of Art. 24(3)
WHT shall be creditable against the taxes due by PE in A (if there is a domestic
WHT)
No credit? Infringement of Art. 24(3)!
EU Directives
PSD -> does NOT apply because the PE is not a ‘Parent Company’ under Art. 3
IRD -> does NOT apply because the scope of Art. 1 is not met
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller matteobarchi97. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $4.89. You're not tied to anything after your purchase.
