I have a US client which sells complex machinery to business clients across Europe. It plans to employ sales people in the UK and in a variety of other European countries. These sales people will work from home travelling to see clients as and when needed. There is a recognition that if the sales people are materially involved in agreeing the sale they may create a taxable presence as a ‘dependent agent’ and we are assured that they do not do so. Will these arrangements create a taxable presence for the purposes of corporation tax in those jurisdictions?
Answer
Whether the US corporation will be exposed to foreign corporate taxes will depend largely upon whether under the terms of the relevant tax treaty a ‘permanent establishment’ (PE) is...
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I have a US client which sells complex machinery to business clients across Europe. It plans to employ sales people in the UK and in a variety of other European countries. These sales people will work from home travelling to see clients as and when needed. There is a recognition that if the sales people are materially involved in agreeing the sale they may create a taxable presence as a ‘dependent agent’ and we are assured that they do not do so. Will these arrangements create a taxable presence for the purposes of corporation tax in those jurisdictions?
Answer
Whether the US corporation will be exposed to foreign corporate taxes will depend largely upon whether under the terms of the relevant tax treaty a ‘permanent establishment’ (PE) is...
If you are not a subscriber, subscribe now to read this content.
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