Triangular Situations in International Tax Law - Case: Finland
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School of Business |
Master's thesis
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Date
2017
Department
Major/Subject
Mcode
Degree programme
Yritysjuridiikka
Language
en
Pages
59
Series
Abstract
The objective of this thesis is to discuss whether triangular cases are problematic in Finland and how they are or would be handled in Finland when Finland is in one of the three roles of the triangular case: the source state, the residence state or the PE state. A triangular case is a situation where a resident of one state has a permanent establishment in another state, which derives income in the form of dividends, interest or royalties from a third state. Triangular cases raise two kinds of problems: firstly, there is a possibility of unrelieved double taxation, and secondly, the problem of treaty abuse and double non-taxation. The thesis is done by conducting a literary research. The main topics concerning triangular cases are international double taxation and tax treaties. These topics are discussed to the extent that they concern triangular cases. Further, EU tax law and directives are looked at, as well as Finnish international tax law. As an example case to examine triangular cases in Finland, a Nordic situation with Finland, Sweden and Denmark involved is discussed. Besides discussing triangular cases in Finland, also BEPS measures concerning triangular cases are looked at. The most relevant actions from the BEPS Action Plan are presented, and the overall impact of the action plan on triangular cases in Finland and worldwide is assessed. It was anticipated in this thesis that it would not be entirely clear how the taxing rights in triangular cases are divided. Regarding Finland the example case, however, reveals no problematic situations, and based on the example case and other research conducted in the thesis it is concluded that triangular cases in Finland are not likely to cause a lot of problems. The research further reveals that BEPS Action Plan will most likely not change the way triangular cases are handled in Finland.Description
Thesis advisor
Viitala, TomiKeywords
triangular cases, tax treaty, double taxation, permanent establishment, BEPS