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4.1. Domestic PE of a Foreign Entity

A foreign company is deemed to have a taxable presence in Algeria, if it habitually conducts a trade, industry or agricultural business in the country; derives profits through an agent in Algeria; or conducts therein operations representing a complete commercial cycle (e.g. purchase of goods followed by their resale). Unless a tax treaty provides otherwise, the after-tax profits of the Algerian business are subject to a branch remittance tax at the rate of 15%.

Service PE is not specifically defined under the Algerian tax legislation. However, a number of Algerian treaties (e.g. those with Saudi Arabia, United Kingdom, Mauritania) provide specifically for service PEs, all of which require the physical presence of an individual for a prescribed period (ranging between 1 and 12 months). Certain tax treaties like those with Austria, Belgium, France, Italy and Germany do not specifically provide for a Service PE clause.