Ensuring Favourable Taxing Rights for Business Profits : An Appraisal of the Permanent Establishment Concept in the UN and OECD Model Tax Conventions

Abstract

As taxation across borders have become a significant event, this study therefore focusses on the taxation of business profits within the context of cross border transactions, especially with reference to permanent establishments. The study places emphasise on the various requirements and variations of the permanent establishment concept as used and defined in the OECD and UN Model Tax Convention respectively, by drawing comparisons between the various requirements and also identifying variances. The study concluded by suggesting that the UN Model Double Tax Conventions offers better taxation of business profits from the perspective of developing countries, within the context of taxing business profits through the use of permanent establishments.