The Fifth Protocol to the Canada - U.S. Income Tax Treaty has introduced a myriad of changes relating to the rights of both countries to tax income earned by their respective residents. Canada - U.S. Tax Treaty: A Practical Interpretation is an invaluable resource designed to assist practitioners with clients involved in cross-border business activities deal with the complexity and uncertainty of these changes.
CCH Canadian’s Canada - U.S. Tax Treaty: A Practical Interpretation contains the full text of the Canada - U.S. Tax Convention, as amended by the First through Fifth Protocols, with commentary by Dentons following each Article of the Treaty. The commentary provides a detailed analysis of the Fifth Protocol, including:
-
Changes to the “tie-breaker” rule for determining the residence of a corporation that qualifies as a resident of both Contracting States
-
Entitlement to Treaty benefits for “fiscally transparent entities”
-
New permanent establishment rules
-
Elimination of withholding tax on certain interest payments
-
Taxation of a non-resident’s emigrant gains
-
Taxation of “income from employment” earned by non-residents
-
Taxation of stock options received by individuals employed in both Canada and the United States
-
Introduction of a reciprocal limitation of benefits provision
The Technical Explanations of the Treaty and the Third, Fourth, and Fifth Protocols, as provided by the U.S. Treasury Department, are reproduced, along with a report on the Fifth Protocol by the Joint Committee on Taxation for the U.S. Senate. Other useful resources contained in this edition include:
- Annotations of related Dominion Tax Cases
- Memorandum of Understanding between the Competent Authorities of Canada and the United States Regarding the Mutual Agreement Procedure
-
Agreement between the Government of Canada and the Government of the United States of America with Respect to Social Security
-
Income Tax Conventions Interpretation Act
-
Rates of Withholding Tax under Income Tax Agreements Signed by Canada
