The Resource AB LLC and another v Commissioner of the South African Revenue Services : Case no. 13276

AB LLC and another v Commissioner of the South African Revenue Services : Case no. 13276

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AB LLC and another v Commissioner of the South African Revenue Services : Case no. 13276
Title
AB LLC and another v Commissioner of the South African Revenue Services : Case no. 13276
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Subject
Language
eng
Summary
Judgment by the Johannesburg Tax Court, judgment date 15 May 2014. The taxpayer was a company resident in the US which provided consultancy services to client companies in the airline industry. It contracted with a South African company and sent personnel to the client's offices. There were staff of the taxpayer present at the client's office from February 2007 to May 2008. They worked in the client's boardroom which they occupied continuously during working hours. The taxpayer was paid by the client in 2007 and 2008 and then in 2009 the taxpayer was paid a "success fee" calculated according to criteria set out in the contract. The taxpayer declared the income in the US and paid US income tax in respect of its earnings from South Africa. The South African Revenue authorities assessed the taxpayer for tax in the years 2007, 2008 and 2009 and imposed penalties for failure to file a return or pay taxes. The dispute required the interpretation of art 5 (1) and 5 (2)(k) of the South African-US double taxation agreement, dealing with "permanent establishment". The taxpayer appealed against the tax assessment, arguing that art 5(2)(k) was governed by art 5(1) while the Revenue argued that art 5(2)(k) (which was not in the OECD Model Convention) extended the meaning of "permanent establishment". This is the first reported decision by a South African court since 1975 that deals with the interpretation of the permanent establishment (PE) concept as used in a tax treaty
Citation source
In: International tax law reports. - London. - Vol. 17 (2015),
http://bibfra.me/vocab/relation/comm
y_8jhG9ykJM
http://library.link/vocab/creatorName
Hattingh, J
Language note
English
http://library.link/vocab/relatedWorkOrContributorName
Baker, P
http://library.link/vocab/subjectName
  • OECD Model
  • case law
  • tax treaty
  • treaty interpretation
  • PE
Label
AB LLC and another v Commissioner of the South African Revenue Services : Case no. 13276
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Publication
Label
AB LLC and another v Commissioner of the South African Revenue Services : Case no. 13276
Publication

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