Scotland‚ s relationship with the EU ‚ Call for Evidence - CIOT response

6 Jul 2017

However, noting that the already announced changes to the definition of a PE, which significantly lower the threshold at which a PE is considered to exist, are highly likely to result in substantially more PEs, the CIOT has suggested that the OECD should consider proposing a de mimimis monetary threshold, for profits and/or sales, below which a company having no physical presence in a territory would have a zero profit attribution, even if under the revised Article 7 a PE would be created.

The CIOT has also suggested that if countries wish to adopt the lower threshold of a PE as outlined in the Report on Action 7, it should at least be recommended that they formally adopt the Authorised OECD Approach to profit attribution.

Our full letter to the OECD can be found here.

Technical Team