| AGREEMENT
BETWEEN THE UNITED KINGDOM OF GREAT BRITAIN AND
NORTHERN IRELAND AND THE REPUBLIC OF TURKEY FOR
THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION
OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME
AND CAPITAL GAINS |
Article
5 |
Permanent
Establishment |
(1) For the purposes
of this Agreement, the term `permanent establishment`
means a fixed place of business through which the
business of an enterprise is wholly or partly carried
on.
(2) The term
`permanent establishment` shall include especially:
(a)
a place of management;
(b) a branch;
(c) an office;
(d) a factory;
(e) a workshop;
(f) a mine, an oil or gas well, a
quarry or any other place of extraction of natural
resources;
(g) an installation or structure
used for the exploration or exploitation of natural
resources.
(3) A building
site or a construction, assembly or installation project
constitutes a permanent establishment only if it lasts
more than six months.
(4) Notwithstanding
the preceding provisions of this Article, the term
`permanent establishment` shall be deemed not to 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 maintenance 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 maintenance 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 carrying on,
for the enterprise, any other activity of a preparatory
or auxiliary character;
(f) the maintenance of a fixed place
of business solely for any combination of activities
mentioned in sub-paragraphs (a) to (e) of this paragraph,
provided that the overall activity of the fixed place
of business resulting from this combination is of
a preparatory or auxiliary character.
(5) Notwithstanding
the provisions of paragraphs (I) and (2) of this Article,
where a person other than an agent of independent
status to whom paragraph
(6) applies
- is acting in a Contracting State on behalf of an
enterprise of the other Contracting State, that enterprise
shall be deemed to have a permanent establishment
in the first-mentioned Contracting State in respect
of any activities which that person undertakes for
the enterprise, if such a person:
(a)
has and habitually exercises in that State an authority
to conclude contracts in the name of the enterprise,
unless the activities of such person are limited to
those mentioned in paragraph (4) which, if exercised
through a fixed place of business, would not make
this fixed place of business a permanent establishment
under the provisions of that paragraph; or
(b) has no such authority but habitually
maintains in that first-mentioned Contracting State
a stock of goods or merchandise belonging to the enterprise
from which he regularly delivers goods or merchandise
on behalf of the enterprise.
(6) An enterprise
of a Contracting State shall not be deemed to have
a permanent establishment in the other Contracting
State merely because it carries on business in that
other State through a broker, general commission agent
or any other agent of an independent status, provided
that such persons are acting in the ordinary course
of their business.
(7) The fact
that a company which is a resident of a Contracting
State controls or is controlled by a company which
is a resident of the other Contracting State, or which
carries on business in that other State (whether through
a permanent establishment or otherwise), shall not
of itself constitute either company a permanent establishment
of the other.
Article
6 |
Income
from immovable property |
(1) Income derived
by a resident of a Contracting State from immovable
property (including income from agriculture or forestry)
situated in the other Contracting State may be taxed
in that other State.
(2) The term
`immovable property` shall have the meaning which
it has under the law of the Contracting State in which
the property in question is situated. The term shall
in any case include property accessory to immovable
property, livestock and equipment used in agriculture
and forestry, fisheries, rights to which the provisions
of general law respecting landed property apply, usufruct
of immovable property and rights to variable or fixed
payments as consideration for the working of, or the
right to work, mineral deposits, sources and other
natural resources; ships, boats and aircraft shall
not be regarded as immovable property. The term shall
not, however, include any property or rights income
from which is a royalty as defined in paragraph (3)
of Article 12 of
this Agreement.
(3) The provisions
of paragraph (1) of this Article shall apply to income
derived from the direct use, letting, or use in any
other form of immovable property.
(4) The provisions
of paragraphs (1) and (3) of this Article shall also
apply to the income from immovable property of an
enterprise and to income from immovable property used
for the performance of independent services.
Article
7 |
Business
profits |
(1) The profits
of an enterprise of 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 profits of the
enterprise may be taxed in the other State but only
so much of them as is directly or indirectly attributable
to that permanent establishment.
(2) Subject to
the provisions of paragraph (3) of this Article, where
an enterprise of 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 the 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 profits of a permanent establishment, there shall
be allowed as deductions expenses which are incurred
for the purposes of the permanent establishment, including
executive and general administrative expenses so incurred,
whether in the State in which the permanent establishment
is situated or elsewhere. No deductions shall be allowed
for sums which are paid (other than the reimbursement
of expenses actually incurred) by the permanent establishment
to the head office or any other office of the enterprise
as royalties, fees or other similar payments in respect
of the use of licences, patents or other rights, as
commission for services rendered or for management,
or, except in the case of a banking enterprise, as
interest on sums loaned to the permanent establishment.
(4) No 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) Where 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.
Article
8 |
International
transport |
(1) Profits derived
by an enterprise of a Contracting State from the operation
of ships, aircraft or road vehicles in international
traffic shall be taxable only in that State.
(2) The provisions
of paragraph (1) of this Article shall also apply
to profits derived from the participation in a pool,
a joint business or an international operating agency.
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