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HMRC internal manual

Double Taxation Relief Manual

From
HM Revenue & Customs
Updated
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Falkland Islands: Offshore Activities

Article 21 of the 1997 agreement contains provisions for the treatment of activities in connection with the exploration or exploitation of the sea-bed, sub-soil and their natural resources. The Article provides that

(a) an enterprise of one country carrying on such activities in the other country is deemed to be carrying on a business in the other country through a permanent establishment, except where the activities in question are carried on in the other country for a period or periods not exceeding in the aggregate thirty days in any twelve month period;

(b) a resident of one country who carries on such activities in the other country consisting of professional services or other activities of an independent character is deemed to be performing those activities from a fixed base in that other country;

(c) employment income derived by a resident of one of the countries in respect of an employment connected with offshore activities in the other country may be taxed in that other country to the extent that the duties of the employment are performed offshore in that other country;

(d) gains derived by a resident of one country from the disposal of certain rights, property and shares connected with the exploration and exploitation of the sea-bed etc. situated in the other country may be taxed in that other country (see Article 21(8).