IBFD Course Programme Practical Aspects of Tax Treaties
Overview and Learning Objectives With increasing cross-border investments, taxpayers may be confronted with double taxation. For over a century, states have concluded treaties to avoid such double taxation. In recent years, there has been growing attention to the use of these double taxation treaties in international tax planning. This course deals with all relevant aspects in the application of tax treaties from a practical angle and discusses important topics, such as permanent establishment and transfer pricing, and the impact on these topics by the latest developments following the OECD BEPS Reports and the Multilateral Instrument (MLI), which once implemented will lead to adjustments of many tax treaties as well as the most recent model conventions of the OECD and the United Nations. The course will consist of a combination of lectures and case studies This is an interactive course with a maximum of 40 participants. Participants will receive access to online supplementary materials. Who Should Attend? The course is suitable for finance and tax staff of multinational enterprises, tax accountants, economists and lawyers, inhouse tax managers, tax and transfer pricing advisers, and government officials and tax officers. Course Level and Prerequisites This is an introductory-level course. Whilst prior experience 2
Day 1 09.00-10.50 Introduction and Residence Place and role of comprehensive tax treaties in the international legal order Relationship between tax treaties and domestic law Types of allocation rules in treaties Entitlement to treaty benefits Residence under domestic tax law Tax treaty concept of residence Tiebreaker rules Residence certificates Recent developments (BEPS project and the Multilateral Instrument) 11.10-12.45 The Permanent Establishment Concept The role of the permanent establishment concept in treaties Basic rules PE Construction PE Dependent agent PE E-commerce BEPS Action 7 developments 14.00-15.20 Dividends, Interest, Royalties, Fees for Technical Services and Capital Gains Allocation of taxing rights regarding dividends, interest, royalties, fees for technical services and capital gains Scope of the provisions Treaty rate applied at the time of the payment versus refund procedure Definitions of dividends, interest, royalties, fees for technical services and capital gains Taxing rights for the source state Taxing rights and obligations for the residence state Beneficial ownership Most favoured nation clauses and tax sparing credits 15.20-15.40 Break Refreshments 15.40-17.00 Case Study PE 3
Day 2 09.00-10.50 Business Profits and Transfer pricing Allocation of taxing rights over business profits OECD approaches Allocation of taxing rights over business profits UN approach How are profits and expenses attributed to the PE and the head office? transfer of assets internal services funding of PEs use of IPR Basic transfer pricing issues TP methods functional analysis comparability study documentation requirements 11.10-12.45 Business Profits and Transfer pricing (continued) 14.00-15.00 The 2017 OECD Model Convention and the 2017 UN Model Convention 15.00-15.20 Break Refreshments 15.20-17.00 Case Study PE and Allocation of Profits and Expenses 4
Day 3 09.00-10.50 Employment Income Taxation of employment income General rules (183-day rule) Hiring-out of labour Frontier workers Taxation of special payments and pensions (periodic and lump-sum payments), government services, students, trainees, professors, directors, artistes and sportsmen Implications for the employing company 11.10-12.45 Basic Tax Planning Principles Popular holding structures Financing structures IP structures International tax planning after BEPS 14.00-15.20 Anti-Avoidance Rules Domestic anti-avoidance rules GAARs thin capitalization rules CFC rules Treaty and MLI provisions beneficial ownership GAARs main purpose test limitation-on-benefits provisions principal purpose test (PPT) under the MLI 15.20-15.40 Break Refreshments 15.40-17.00 Case Study on Employment Income 5