Classification Of Payments Of Services And Know-howOne of the issues that Technical Advisory Group (TAG) of the OECD examined in February 2001 report titled “Tax Treaty Characterization Issues Arising from E-Commerce” was the classification issue for payments of Services and Know-how (i.e. information concerning industrial, commercial or scientific experience). The Group thought that it was necessary to distinguish whether the consideration for a payment is the provision of services or the provision of know-how. Therefore, the TAG Group has made some recommendations which would help to recognize the difference between these two provisions for consideration of payment.
The following questions have been addressed in this article:What about the mixed contract which cover both know-how and the provision of technical assistance?
Is the payment made as consideration for the acquisition of property different than the payment for the provision of services?
What about the e-commerce payments of technical fees?
What are technical services?
What services constitute managerial and consultancy services?