Commentary

D4.710 Permanent establishment deduction/non-inclusion arrangements—qualifying conditions

Corporate tax
Corporate tax | Commentary

D4.710 Permanent establishment deduction/non-inclusion arrangements—qualifying conditions

Corporate tax | Commentary

D4.710 Permanent establishment deduction/non-inclusion arrangements—qualifying conditions

The mismatch rules also apply to arrangements involving permanent establishments. This significantly increases the potential impact of the regime and is necessary because a permanent establishment can often be taxed locally as if it were a standalone entity but also as part of the larger entity in the parent company jurisdiction, creating similar potential for mismatches as hybrid entities. The rules apply many of the provisions targeted at hybrid entities to permanent establishments. This particularly affects loss-making permanent establishments, as there are increased restrictions on using the loss in the UK alongside the risk

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