2013-2014 Worldwide Cloud Computing Tax Guide

This guide summarizes the cloud computing corporate tax regimes in 95 countries and the OECD. Use the map or the menu to see the guide’s information for a country.

This guide summarizes the cloud computing corporate tax regimes in 95 countries and the OECD. Use the menu to see the guide’s information for a country.

 
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Cloud computing has burst onto the commercial scene, affecting many industries. Generally defined as the hardware and software that supports transactions over a virtual network (i.e., the internet), cloud computing has a borderless quality that creates complexity for taxing jurisdictions.

Despite that complexity, governments are actively investigating and writing tax laws in this area, increasing the risk that taxpayers will be caught unprepared in some countries. In a recent report on base erosion and profit shifting (BEPS), the Organisation for Economic Co-operation and Development (OECD) specifically identified cloud computing transactions as an area in which “international tax standards may not have kept pace with changes in global business practices.” A current guide like this one is all the more valuable in such a shifting tax landscape.

Each country chapter contains contact information for the key people in that country’s EY offices, two at-a-glance tables about the jurisdiction’s corporate tax and its VAT or GST. Then diagrams contemplate transactions according to three operating models: the commissioned agent, the commissionaire and the buy-sell models. Within each are high-level tax considerations regarding contractual terms that indicate lease/rental/license, sale or service arrangements. Then we discuss how these payments are taxed in four respects: income characterization, withholding tax, permanent establishment and indirect tax.

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