Common use of BUSINESS INCOME OR PROFITS Clause in Contracts

BUSINESS INCOME OR PROFITS. 1. The income or profits of an enterprise of one of the States shall be taxable only in that State unless the enterprise carries on business in the other State through a permanent establishment situated therein. If the enterprise carries on business as aforesaid, the income or profits of the enterprise may be taxed in the other State but only so much of them as is attributable to that permanent establishment. 2. Subject to the provisions of paragraph 3, where an enterprise of one of the States carries on business in the other State through a permanent establishment situated therein, there shall in each State be attributed to that permanent establishment to income or profits which it might be expected to make if it were a distinct and separate enterprise engaged in the same or similar activities under the same or similar conditions and dealing wholly independently with the enterprise of which it is a permanent establishment. 3. In determining the income or profits of a permanent establishment, there shall be allowed as deductions expenses, including executive and general administrative expenses, which would be deductible if the permanent establishment were an independent enterprise, insofar as they are reasonably allocable to the permanent establishment, whether incurred in the State in which the permanent establishment is situated or elsewhere. 4. If the information available is inadequate to determine the income or profits to be attributed to the permanent establishment, nothing in this Article shall affect the application of any law of a State relating to the determination of the tax liability of a person by making an estimate, provided that the result shall be in accordance with the principles contained in this Article. 5. No income or profits shall be attributed to a permanent establishment by reason of the mere purchase by that permanent establishment of goods or merchandise for the enterprise. 6. Where income or profits include items of income which are dealt with separately in other Articles of this Agreement, then the provisions of those Articles shall not be affected by the provisions of this Article.

BUSINESS INCOME OR PROFITS. 1. The income or profits of an enterprise of one of the Contracting States shall be taxable only in that State unless the enterprise carries on business in the other Contracting State through a permanent establishment situated therein. If the enterprise carries on business as aforesaid, the income or profits of the enterprise may be taxed in the other State State, but only so much of them as is attributable to that permanent establishment. 2. Subject to the provisions of paragraph 3, where an enterprise of one of the Contracting States carries on business in the other Contracting State through a permanent establishment situated therein, there shall in each Contracting State be attributed to that permanent establishment to the income or profits which it might be expected to make if it were a distinct and separate enterprise engaged in the same or similar activities under the same or similar conditions and dealing wholly independently at arm's length with the enterprise of which it is a permanent establishmentestablishment or with other enterprises with which it deals. 3. In determining the determination of the income or profits of a permanent establishment, there shall be allowed as deductions expensesexpenses of the enterprise, being expenses (including executive and general administrative expenses, ) which are reasonably connected with the permanent establishment and which would be deductible if the permanent establishment were an independent enterprise, insofar as they are reasonably allocable to the permanent establishmententity that incurred those expenses, whether incurred in the Contracting State in which the permanent establishment is situated or elsewhere. 4. If the information available is inadequate to determine the income or profits to be attributed to the permanent establishment, nothing in this Article shall affect the application of any law of a State relating to the determination of the tax liability of a person by making an estimate, provided that the result shall be in accordance with the principles contained in this Article. 5. No income or profits shall be attributed to a permanent establishment by reason of the mere purchase by that permanent establishment of goods or merchandise for the enterprise. 5. If the information available to the competent authority of a Contracting State is inadequate to determine the income or profits to be attributed to the permanent establishment of an enterprise, nothing in this Article shall affect the application of any law of that State relating to the determination of the tax liability of a person by the exercise of a discretion or the making of an estimate by the competent authority, provided that that law shall be applied, so far as the information available to the competent authority permits, in accordance with the principles of this Article. 6. Where income or profits include items any item of income or profits which are is dealt with separately in other Articles another Article of this Agreement, then the provisions of those Articles that other Article, (except where otherwise provided in that Article) shall not be affected by the provisions of this Article. 7. Nothing in this Article shall affect the operation of any taxation law: (a) in the case of Malaysia, relating to income or profits from an insurance business; and (b) in the case of Australia, relating to insurance with non-residents: Provided that if the relevant law in force in either Contracting State at the date of signature of this Agreement is varied (otherwise than in minor respects so as not to affect its general character), the Contracting States shall consult with each other with a view to agreeing to any amendment of this paragraph that may be appropriate.

BUSINESS INCOME OR PROFITS. 1. The income or profits of an enterprise of one of the States a Contracting State shall be taxable only in that State unless the enterprise carries on business in the other Contracting State through a permanent establishment situated therein. If the enterprise carries on business as aforesaid, the income or profits of the enterprise may be taxed in the other State but only so much of them as is attributable to to: (a) that permanent establishment; or (b) sales within that other State of goods or merchandise of the same or similar kind as those sold, or from other business activities of the same or similar kind as those affected, through that permanent establishment. 2. Subject to the provisions of paragraph 3, where an enterprise of one of the States a Contracting State carries on business in the other Contracting State through a permanent establishment situated therein, there shall in each Contracting State be attributed to that permanent establishment to the income or profits which it might be expected to make if it were a distinct and separate enterprise engaged in the same or similar activities under the same or similar conditions and dealing wholly independently with the enterprise of which it is a permanent establishment. 3. In determining the determination of the income or profits of a permanent establishment, there shall be allowed as deductions all expenses, including executive and general administrative expenses, which would be deductible if the permanent establishment were an independent enterprise, insofar in so far as they are reasonably allocable to the permanent establishment, whether incurred in the State in which the permanent establishment is situated or elsewhere. 4. If the information available is inadequate In so far as it has been customary in a Contracting State to determine the income or profits to be attributed to a permanent establishment on the permanent establishmentbasis of an apportionment of the total income or profits of the enterprise to its various parts, nothing in paragraph 2 or paragraph 3 of this Article shall affect preclude such Contracting State from determining the application income or profits to be taxed by such apportionment as may be customary; the method of any law of a State relating to the determination of the tax liability of a person by making an estimateapportionment adopted shall, provided however, be such that the result shall be in accordance with the principles contained laid down in this Article. 5. No income or profits shall be attributed to a permanent establishment by reason of the mere purchase by that permanent establishment of goods or merchandise for the enterprise. 6. For the purposes of the preceding paragraphs, the income or profits to be attributed to the permanent establishment shall be determined by the same method year by year unless there is good and sufficient reason to the contrary. 7. Where income or profits include items of income or profits which are dealt with separately in other Articles of this Agreement, then the provisions of those Articles shall not be affected by the provisions of this Article.

BUSINESS INCOME OR PROFITS. 1. The income or profits of an enterprise of one of the States a Contracting State shall be taxable only in that State unless the enterprise carries on business in the other Contracting State through a permanent establishment situated therein. If the enterprise carries on business as aforesaid, the income or profits of the enterprise may be taxed in the other State State, but only so much of them as is attributable to to: (a) that permanent establishment; or (b) sales within that other State of goods or merchandise of the same or similar kind as those sold, or from other business activities of the same or similar kind as those affected, through that permanent establishment. 2. Subject to the provisions of paragraph 3, where an enterprise of one of the States a Contracting State carries on business in the other Contracting State through a permanent establishment situated therein, there shall in each Contracting State be attributed to that permanent establishment to the income or profits which it might be expected to make if it were a distinct and separate enterprise engaged in the same or similar activities under the same or similar conditions and dealing wholly independently with the enterprise of which it is a permanent establishment. 3. In determining the determination of the income or profits of a permanent establishment, there shall be allowed as deductions deduction all expenses, including executive and general administrative expenses, which would be deductible if the permanent establishment were an independent enterprise, insofar in so far as they are reasonably allocable to the permanent establishment, whether incurred in the State in which the permanent establishment is situated or elsewhere. 4. If the information available is inadequate In so far as it has been customary in a Contracting State to determine the income or profits to be attributed to a permanent establishment on the permanent establishmentbasis of an apportionment of the total income or profits of the enterprise to its various parts, nothing in paragraph 2 or paragraph 3 of this Article shall affect preclude such Contracting State from determining the application income or profits to be taxed by such apportionment as may be customary; the method of any law of a State relating to the determination of the tax liability of a person by making an estimateapportionment adopted shall, provided however, be such that the result shall be in accordance with the principles contained laid down in this Article. 5. No income or profits shall be attributed to a permanent establishment by reason of the mere purchase by that permanent establishment of goods or merchandise for the enterprise. FBR, Government of Pakistan 6. For the purpose of the preceding paragraphs, the income or profits to be attributed to the permanent establishment shall be determined by the same method year by year unless there is good and sufficient reason to the contrary. 67. Where income or profits include items of income or profits which are dealt with separately in other Articles of this Agreement, then the provisions of those Articles shall not be affected by the provisions of this Article.