The OECD has released a discussion draft that includes proposals for changes to the OECD Model Tax Convention concerning the treaty residence of pension funds.
Paragraph 12 of the final version of the Report on Action 6 of the BEPS Action Plan (Preventing the Granting of Treaty Benefits in Inappropriate Circumstances) indicates that:
Additional work will also ensure that a pension fund should be considered to be a resident of the State in which it is constituted regardless of whether that pension fund benefits from a limited or complete exemption from taxation in that State. This will be done through changes to the OECD Model Tax Convention, to be also finalised in the first part of 2016, that will ensure that outcome for funds that will meet a definition of “recognised pension fund”…
This discussion draft includes draft changes to Articles 3 and 4 of the OECD Model Tax Convention, and to the Commentary on these Articles, that are designed to ensure that a pension fund is considered to be a resident of the State in which it is constituted for the purposes of tax treaties.
Comments are due by 1 April 2016.
[OECD announcement] [Discussion Draft] [BEPS – inappropriate treaty benefits] [LTN 40, 1/3/16]