DTA = double taxation agreement. Correctly: agreement on the prevention of double taxation. Double taxation agreements regulate which country is entitled to the right of taxation under which circumstances. The definition of the permanent establishment as place of taxation is essential for entrepreneurs. Since DTAs are OECD standardised, the definitions in all double taxation agreements are the same.

• Download OECD model agreement

• Double Taxation Agreements UK

Extract to the subject of permanent establishment:

(1)   For the purpose of this Convention, the term “permanent establishment” means a fixed place of business through which the business of an enterprise is wholly or partly carried out.

(2)   The term “permanent establishment” includes especially:

a)      a place of managment;

b)      a branch;

c)      an office;

d)      a factory;

e)      a workshop, and

f)        a mine, an oil or gas well, a quarry or any other place of extraction of natural resources

g)      a building site or construction or installation project that lasts more than twelve months.

(3)   THE TERM “PERMANENT ESTABLISHMENT” DOES NOT INCLUDE:

a)      the use of facilities solely for the purpose of storage, display or delivery of goods or merchandise belonging to the enterprise;

b)      the mainenance of a stock of goods or merchandise belonging to the enterprise solely for the purpose of storage, display or delivery;

c)      the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the purpose of processing by another enterprise;

d)      the mainentance of a fixed place of business solely for the purpose of purchasing goods or merchandise or of collecting information for the enterprise;

e)      the maintenance of a fixed place of business solely for the purpose of advertising for the enterprise, issuing information, doing scientific research or carrying out similar activities of a preparatory or auxiliary character.