Permanent establishment

Filed Under: Taxation

1 definition found for this term.
Definitions are presented in the order source books were published (most recent first).


A permanent establishment is a fixed place of business through which an enterprise carries on its business in whole or in part. The concept of permanent establishment applies when a state determines that, under its domestic law, the business profits of a resident of another state may be taxable. Tax treaties generally provide that the business profits of an enterprise of one contracting state derived from activities or sources in the other contracting state are not taxable by the source state unless they are attributable to a permanent establishment therein.

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