Fundamentals of International Taxation Summary

Fundamentals of
International Taxation -
Summary for the
preparation of the Exam




✓

,lnitialquestionsforeoerycase.nl
subjective objective and scope fulfilled?
2) who is
being taxed
?
3) what ?
ground
on

4) in what amount ?

Dtctosolveloubkltaxation
-



DTCs restrict the application of domestic law in a bilateral context



tlierarchyotDTCanddomestic.la#
domestic constitutional law ( DTCandconstitutionallaw are )
depends on
treaty overrideexists where at one level
-




if Treaty provides taxation possibility not
purpose and intention of to TPa
new
Treaty
→
a
give disadvantage
-




-


DTCprovides definition a domestic law → DTCprevails


provision overlap usually DTC States which provision is to be applied→ifnot:States must
agree upon this matter
-


:




Avoidance of Double (
non1 Taxation
→

goals
:




Prevention of abusive behaviour




ASK.jectiveandobjectivescope-AA.ie#


A .




2 .




3 .




AA.nth-snbjectives.co#
persons who are residents ofone or both CS
-
-



,




a)PersonAA.3l




→

Commentary on AA 3
.

para -
2




1 because of domestic treatment either as
partnerships person
=
,




I ) other
body ofperson transparent)
I
company opaque
or




aalpah-nershipsAA.tl# →see AA 1127.

para 2 It .
.



Commentary
applicable if one or both CS considerthe partnership as liable to tax under their domestic lawand therefore
-




as Residents →
see
para .
5
"




through that entity regardless ofthe view
"

income derived has broad 2
through orby meaning any income derived
-


a
,



of each Cs as to who derives that income for domestic purposes → see
para -
t

, doesn't matter where
entity is established can also bein a third state as
long as the income ofthe entity can be
-




,



attributedto a Resident otoneotthecs-sseepara.tt



income
→ →
see .8
para


by chapterII
all items of income covered
wide
meaning covering
-




,




fiscallgtransparent-seepara.CH
→
.




under domestic law of acs, the income is not taxed on the level ofthe
entity but on the person level, who have an interest
-
-




,




in that
entity

→
examples
A- sees as opaque
staxciab.CH
opaque
-


-




-

both countriessee it _A -


opaque
g- B sees as transp .
and allocates income to person -
level .z
person is




§ B'
usiaentaionu'T hits "'

n'
only B
opaqeacsanopfaq.ee
a -
Nsp .




ii
¥eB A- sees as opaque Reliability f) trsp .




① B sees as transp .
I
a
-
"
t)



Double Non Taxation




b lsaringsdause-A .rs#b)Resident-sA .4-se para.2H .




providing a definition
-
not ofa Resident
→
domestic law of CS decides about is therein based on one of the factors in 4th
Residency if Residency
→




aalliable.to#
not if
only liable to taxon source income para 8. n
-

.




no't held taxon 8.2
if foreign company exempt from
is
foreign income para
-


-
.



,




not, if person is considered to be Resident of another CSpursuant to a DTC 8.Losee horizontalelectof DTG
para
-




-




AAA -4117 sent 2- included
aggressive tax planning of companies
-
'

forexclusion ofdiplomats; but extendeddue to to


tax
source income
liability
- - -




generaldefinition
→
no



POnodetinitionwithinthe.DK?-3AA.312)MTCtpara -




Mff .




)
agreement of competent authorities ?
-




12
Para
does the context require otherwise ?
-
-




-


domestic lawfasiastaegop ,

④whatisthe.com#t?-
→
see AA -31 of the Vienna contract




)
also OECD
good faith ordinary meaning
context,
object and purpose preambles, contracts attachments
'


, , , ,




international understanding understanding of other countries historicalbackground commentary but
°



,
, ,



not
speeches,juridicaldecisions ,
explanatory notes ,
academic opinions binding a
@whendoestheconlextreguireotherwise2.t
'




if applying domestic meaning would be
contrary
to the intention of the parties of a DTC