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HMRC internal manual

Double Taxation Relief Manual

Sweden: Offshore activities

Article 28 of the agreement contains provisions for the treatment of activities in connection with the exploration or exploitation of the sea-bed, subsoil and natural resources. These provide that;

* an enterprise of one country carrying on such activities is deemed to be carrying on a business in the other country through a permanent establishment;
* a resident of one country who carries on such activities consisting of professional services or other activities of an independent character in the other country is deemed to be performing those activities from a fixed base in that other country;
* profits derived by an enterprise of one country from the transportation of supplies and personnel to a location where such activities are carried on or from the operation of tug-boats etc in connection with such activities are only taxable in the country in which the enterprise has its place of effective management.

Reference should be made to the Article for details of certain limitations in connection with the duration of the activities.

There are also provisions for the taxation of salaries, wages and similar remuneration of residents of each country on earnings in connection with such activities. Refer any problems in this connection to Business Services Office (Operational Policy).