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Question 4: Canada-Barbados Income Tax Convention – “Special Tax Benefit” Paragraph 3 of Article XXX (Miscellaneous Rules) of the Canada-Barbados Income Tax Convention (“the Treaty”) provides: 3. ... Income Tax Convention (the “Treaty”) and is entitled to benefits under the Treaty (i.e., USco is a “qualifying person” for purposes of Article XXIX-A of the Treaty). ... Income Tax Convention (“the Treaty”). US LLC 1 makes an interest bearing loan to US LLC 2. ...

This report was revised in 2010 in order to be read harmoniously with the new wording of Article 7 of the OECD’s Model Tax Convention on Income and Capital (“ Model Convention ”) and its related commentary. ... This position is essentially based on our view that paragraph 4(b) of the Income Tax Conventions Interpretation Act (ITCIA), prevents such deductions. ... In respect of the Canada-UK Tax Convention, we note that the new AOA-based Article 7 language was included in the Convention by virtue of the protocol signed on July 21, 2014. ...

Email this Content General OECD Publications Multilateral Convention to Implement Amount A of Pillar One (11 October 2023) Multilateral Convention to Facilitate the Implementation of the Pillar Two Subject to Tax Rule (15 September 2023) Crypto-Asset Reporting Framework and Amendments to the Common Reporting Standard (10 October 2022) Model Convention on Income and Capital, and Commentaries (25 April 2019) Online reader available- PDF version is paywalled by OECD. Model Convention on Income and Capital, and Commentaries- condensed version (21 November 2017) Online reader available- PDF version is paywalled by OECD. ...

Turning now to the ITCIA itself, s. 4.1 states that “notwithstanding the provisions of a Convention or the Act giving the Convention the force of law in Canada, it is hereby declared that the law of Canada is that section 245 of the ITA, the GAAR, applies to any benefit provided under the Convention.” ... Covered tax conventions will be modified by the MLI once the implementing act receives Royal assent, such that the PPT is part of that Convention and should be applied like all other rules in the Convention. ... In other words, if the PPT applies, there will be no tax benefit under the Convention, to which the GAAR could apply. ...

Mutual Assistance in Tax Matters The Multilateral Convention on Mutual Assistance in Tax Matters, of which Canada and another 89 jurisdictions are members, has effectively extended Canada's tax information exchange agreement and exchange-of-information relationships with those 89 jurisdictions. ... There are 19 jurisdictions, not covered by Treaties or TIEAs, for which the multilateral convention provides for exchanges of information with Canada. More comprehensive information on this will be provided on the Treaty section of the Finance website, which will set out a complete list of countries that are members of this multilateral Convention. ...

Since payments from RDSPs and TFSAs to US residents are not dealt with in any other Article of the Convention, they qualify as "other income" for the purposes of Article XXII:1 of the Convention. ... Tax Convention: U.S. Technical Explanation", June 13, 1995)]. However, the Income Tax Conventions Interpretation Act [FN28: R.S.C. (1985), c. ... As stated above, Article XXII of the Convention only applies where the items of income of a resident of a Contracting State are not dealt with in the Articles preceding Article XXII of the Convention. ...

The Convention was only adopted at the end of November 2016 and there was a target date of a June 2017 signing ceremony. ... To then be able to notify the OECD depositary of the Convention, an Order in Council is first needed, which requires going to the Treasury Board. If we assume that the Bill is passed, and that it gets on the Treasury Board agenda and the OECD is notified, in August 2018, that would result in an entry into force of the Convention on December 1, 2018. ...

By virtue of section 4.3 of the Income Tax Conventions Interpretation Act, Trust will be deemed not to be a resident of any state other than Canada for purposes of applying a tax treaty. ... However, we would note that the application of the Canada-US Tax Convention to a US LLC as well as certain other Canadian tax consequences, such as foreign tax credits and deductions, may be different depending upon whether the US LLC is treated as a fiscally transparent entity or a corporation under US tax law. ...

Email this Content BEPS 2014- OECD Base Erosion and Profit Shifting Project Instruments and Guidelines Canadian Adoption OECD Guidelines Action Items Final Action Item Drafts Other Instruments and Guidelines Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS OECD, 7 June 2017 (Explanatory Notes) Canadian Adoption Status of List of Reservations and Notifications at the Time of Signature Department of Foreign Affairs, Trade and Development, 30 May 2017 (press release) Backgrounder: Impact of Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (fin.ca) Department of Foreign Affairs, Trade and Development, 6 June 2017 OECD Guidelines Standard for Automatic Exchange of Financial Information in Tax Matters- Implementation Handbook- Second Edition OECD, April 2018 Action Items Final Action Pages Size Action 1: Addressing the Tax Challenges of the Digital Economy 285 3.21 M Action 2: Neutralising the Effects of Hybrid Mismatch Arrangements 454 5.22 M Action 3: Designing Effective Controlled Foreign Company Rules 69 1.96 M Action 4: Limiting Base Erosion Involving Interest Deductions and Other Financial Payment 115 2.09 M Action 4 2016 update 214 2.68 M Action 5: Countering Harmful Tax Practices More Effectively, Taking into Account Transparency and Substance 79 3.26 M Action 6: Preventing the Granting of Treaty Benefits in Inappropriate Circumstances 101 1.75 M Action 7: Preventing the Artificial Avoidance of Permanent Establishment Status 46 1.70 M Actions 8-10: Guidance on Transfer Pricing Aspects of Intangibles 186 2.24 M Action 11: Measuring and Monitoring BEPS 268 4.64 M Action 12: Mandatory Disclosure Rules 97 1.89 M Action 13: Guidance on Transfer Pricing Documentation and Country-by-Country Reporting 70 1.59 M Action 13 September 2017 update 20 195 K Action 14: Making Dispute Resolution Mechanisms More Effective 45 1.54 M Action 15: Developing a Multilateral Instrument to Modify Bilateral Tax Treaties 54 1.53 M Action Item Drafts "Action Plan on Base Erosion and Profit Sharing" OECD, July 2013 "Addressing Tax Challenges of the Digital Economy" (deliverable) OECD, 16 September 2014 (200 pages/4.70 M) "Neutralising the Effects of Hybrid Mismatch Arrangements" (deliverable) OECD, 16 September 2014 (100 pages/1.77 M); (first discussion draft) (79 pages/505 K); (second discussion draft) (14 pages/356 K) "Strengthen CFC Rules" (discussion draft) OECD, 3 April 2015 (70 pages/576 K) "Interest Deductions and Other Financial Payments" (discussion draft) OECD, 11 February 2014 (93 pages/1.48 M) (discussion draft re interest in banking and insurance) (33 pages/791 K) "Countering Harmful Tax Practices More Effectively, Taking into Account Transparency and Substance" (deliverable) OECD, 16 September 2014 (68 pages/1.48 M) "Preventing the Granting of Treaty Benefits in Inappropriate Circumstances" (deliverable) OECD, 16 September 2014 (108 pages/2.00 M); (discussion draft) (44 pages/313 K) "Preventing the Artificial Avoidance of PE Status" (discussion draft) OECD, 31 October 2014 (26 pages/144 K) (discussion draft) (314 K) "Guidance on Transfer Pricing Aspects of Intangibles" (deliverable) OECD, 16 September 2014 (132 pages/2.29 M) (discussion draft) (393 K) "Assure that transfer pricing outcomes are in line with value creation: risks and capital" (to be released) "Proposed Modifications to Chapter VII of the Transfer Pricing Guidelines Relating to Low Value-Adding Intra-Group Services" (discussion draft) OECD, 3 November 2014 (20 pages/836 K) "Establish methodologies to collect and analyse data on BEPS and the actions to address it" (discussion draft) (1.89 M) "Mandatory Disclosure Rules" (discussion draft) OECD, 1 April 2014 (82 pages/668 K) "Guidance on Transfer Pricing Documentation and Country-by-Country Reporting" (deliverable) OECD, 16 September 2014 (48 pages/3.22 M) "Make dispute resolution mechanisms more effective" (released as final draft only) "Developing a Multilateral Instrument to Modify Bilateral Tax Treaties" (deliverable) OECD, 16 September 2014 (64 pages/1.89 M) Other Interpretation and Implementation Questions, OECD, 20 May 2021 (370 K) Statement by the OECD/G20 Inclusive Framework on BEPS on the Two-Pillar Approach to Address the Tax Challenges Arising from the Digitalisation of the Economy OECD, 29-30 January 2020 (456 K) Action 4, 8-10- Transfer Pricing Guidance on Financial Transactions OECD, 11 February 2020 (666 K) (OECD announcement) Action 6- Peer review of minimum standards OECD, 29 May 2017 (OECD announcement) Action 13- Guidence on the Implementation of Country-by-Country Reporting OECD, 5 December 2016 (294 K) (OECD announcment) Action 13- Guidence on the Implementation of Country-by-Country Reporting OECD, 8 February 2017 (232 K) (OECD announcment) Action 13- Guidance on the appropriate use of information contained in CbC Reports OECD, 6 September 2017 (232 K) (OECD announcment) Action 15- A Mandate for the Development of a Multilateral Instrument on Tax Treaty Measures to Tackle BEPS OECD, 31 May 2016 (491 K) (OECD announcement) ...

A document of full powers will be prepared and presented to the depositary of the Convention, who is the OECD secretary. ... Now, looking at the structure of the arbitration provision that are in the MLI, we should consider the two greatest influences on the drafting of the MLI – the EU Arbitration Convention, and the Canada-US Tax Treaty. ... Independent opinion is based on a precedent from the EU Arbitration Convention, and it would effectively work more like a court proceeding – with evidence rules and oral hearings. ...