Server permanent establishment

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The server permanent establishment is a concept of international tax law. Particularly on a unilateral ( § 49 and the international level 2a Income Tax Act, para. 1 no.) (Art. 5 of the OECD Model) is the question of whether a server a taxable permanent establishment may be justified in a state of great importance. Establishing a permanent establishment through a server would create a tax connection point in the country in which the server permanent establishment is located. It is also questionable how high the taxable profit can be attributed to a server permanent establishment.

Unilateral requirements

Under German tax law, a server permanent establishment is only established if it meets the requirements set out in Section 12 AO. Accordingly, a server is to be qualified as a permanent establishment if it is a fixed business establishment that serves the activity of a company, is operated sustainably and the company can exercise a certain power of disposal over the server. In addition, there could also be a tax point of contact through a representative permanent establishment (§ 13 AO) if the Internet server is intended to conclude contracts, collect orders, maintain stocks of (digital) goods or make deliveries via the Internet.

Fixed business facility: The server operating facility consists of a tangible (server) and an immaterial component ( software and data stored on the server ). The immaterial component cannot establish a permanent establishment, so the material component is decisive. In order for a permanent business establishment to be established, the server must be permanently anchored in place.

Power of disposal : The company must have legal and economic power of disposal; Commissioning an external service provider to operate a server is not sufficient here.

Business activity : The server must serve the purpose of business activity. The Internet server must represent an elementary component for adding value to the company, ie it must be able to electronically map online transactions. An example of this is a normal Internet site that has the purpose of selling goods online.

Multilateral requirements

In terms of treaty law, the requirements for establishing a server permanent establishment are linked to the requirements for an ordinary permanent establishment, which, however, are relatively narrower. According to Article 5, Paragraph 1 of the OECD-MA, a server must be a permanent business establishment that carries out the business activity in whole or in part. In addition, the activity must exceed the scope of auxiliary and preparatory activities (Art. 5 Para. 4 OECD-MA).

Fixed business establishment: The model commentary on the OECD model convention distinguishes - as it does unilaterally - between the material and immaterial components of a server permanent establishment: In this context, data and software are immaterial and do not constitute a permanent establishment. A website is therefore not a permanent establishment, even if it is used by domestic customers. This problem exists z. B. in the taxation of Amazon. In contrast, the hardware of the server can establish a fixed business facility. In addition, the business activity must exist for more than six months.

Business activity : The server must carry out the actual business activity of the company or at least carry out “core functions” that have been outsourced to the server. Carrying out ancillary activities (Art. 5 Para. 4 OECD-MA) is not sufficient. In addition, the presence of personnel is not absolutely necessary, so that a fully automatic Internet server can represent an operating facility.

Profit accrual for server operating facilities

In principle, the so-called Authorized OECD Approach (AOA) has been used for profit accrual since 2010 (Art. 7 Para. 2 OECD-MA). The AOA was anchored unilaterally by Section 1 Paragraphs 4 and 5 AStG. According to Art. 7 Para. 2 OECD-MA, profits can be allocated to a permanent establishment that it could have achieved as an independent and independent company using the arm's length principle . Before this, the functions performed, the risks assumed and the allocation of assets / capital resources that originate from the parent company are determined in the context of a function and risk analysis. The most important criteria for profit accrual or attribution are the "essential personnel functions". As a rule, these are not available at server operating facilities, so due to a lack of personnel, neither functions nor risks can be exercised or taken over. In fact, this means that the amount of profit attribution ultimately depends on the staffing. As a result, little or no profit could be attributed to the server permanent establishment in this case.

Individual evidence

  1. See Portner, R., IFSt -schrift No. 390 (2001), pp. 29-30.
  2. Jacobs, O., International Corporate Taxation (2007), p. 362.
  3. Jacobs, O., International Corporate Taxation (2007), p. 362.
  4. ^ Jacobs, O., International Corporate Taxation (2007), p. 363.
  5. Tipke, K./Kruse, HW, Tax Code, § 12 AO, note 19.
  6. Jacobs, O., International Corporate Taxation (2007), p. 362.
  7. ^ Jacobs, O., International Corporate Taxation (2007), p. 364.
  8. No. 42 OECD-MK on Art. 5 OECD-MA 2010.
  9. Pinkernell, R., IFSt -schrift No. 494 (2014), pp. 87-88.
  10. No. 2 OECD-MK to Art. 5 OECD-MA 2010.
  11. No. 6 OECD-MK to Art. 5 OECD-MA 2010.
  12. No. 42.8 OECD-MK on Art. 5 OECD-MA 2010.
  13. ^ Görl in Vogel / Lehner, DBA (2008), Rn. 29
  14. Pinkernell, R., IFSt -schrift No. 494 (2014), pp. 96-98.
  15. Kahle / Mödinger, DSt 2012, 802, 806.