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Untd A Emirates - Iraq Tax Treaty (2017, not yet in force) — Orbitax Tax Hub

Note: This Treaty may be impacted by the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS (MLI). MLI impact on Tax Treaties is available with the Orbitax International Tax Research & Compliance Expert.


Business Profits

(1) The business profits of an enterprise in a Contracting State shall be taxable only in that State unless the enterprise carries out business in the other Contracting State through a permanent establishment. If the enterprise carries out business as aforesaid, the profits of the enterprise shall be taxable in the other Contracting State only to the extent that may be attributable to that permanent establishment in accordance with the tax law of that other state.

(2) In accordance with the provisions of paragraph (3) hereof, if an enterprise in a Contracting State carries out business in the other Contracting State through a permanent establishment in the other Contracting State, the profits of the enterprise permanent establishment shall be defined according to the profits that are generated in any of the Contracting States if the enterprise is independent as well as similarly operates the same or similar activities under the same or similar conditions and deals wholly independently from the enterprise that is considered its permanent establishment.

(3) While calculating the profits of the permanent establishment, the expenditures of the permanent establishment, including the executive and administrative expenses, shall be deducted, whether such permanent establishment is located in one of the Contracting States or in any other place.

(4) If it is customary in a Contracting State to determine the profits of a permanent establishment upon the relative distribution of total profits of the enterprise on the different parts thereof, the provisions of paragraph (2) hereof shall not prevent such Contracting State from the determination of the profits which are subject to tax upon the customary relative distribution, provided that the method used shall be compatible with the provisions hereof.

(5) For the purposes of the preceding paragraphs hereof, the profits to be attributed to the permanent establishment shall be determined by the same method every year unless there is good and sufficient reason to the contrary.

(6) If the profits include items of income separately addressed by other articles herein, the provisions of this Article shall not prejudice the provisions of such articles.