2014 update to the OECD Model Tax Convention

The OECD Council has approved the contents of the [2014 Update](http://www.oecd.org/ctp/treaties/update-model-tax-convention-2014.pdf) to the OECD Model Tax Convention. The Update, which was previously approved by the Committee on Fiscal Affairs on 26 June, will be incorporated in a revised version of the Model Tax Convention that will be published in the next few months.

The [2014 Update](http://www.oecd.org/tax/treaties/2014-update-model-tax-convention.htm) reflects work on the Model Tax Convention that was carried out between 2010 and the end of 2013; it does not, therefore, include any results from the ongoing work on the BEPS Action Plan.

The Update also includes the changes to [Article 26](http://www.oecd.org/ctp/taxoecdupdatesoecdmodeltaxconventiontoextendinformationrequeststogroups.htm) and its Commentary that were approved by the OECD Council on 17 July 2012. It also includes the final version of a number of changes that were previously released for comments through the following discussion drafts:

* The application of Article 17 (Artistes and Sportsmen) of the OECD Model Tax Convention (23 April 2010)
* Revised proposals concerning the meaning of “beneficial owner” (19 October 2012)
* Revised discussion draft on tax treaty issues related to emissions permits and credits (19 October 2012)
* Tax treaty treatment of termination payments (25 June 2013)
* Technical changes to be included in the next Update to the Model Tax Convention (15 November 2013).

The introduction to the contents of the 2014 Update provides information on how comments received on some of the discussion drafts listed above were dealt with. In addition, the reports on “Tax treaty issues related to emissions permits/credits” and “Issues related to Article 17 of the OECD Model Tax Convention” provide additional background for some of the changes included in the Update (these reports will be added to the section of the full version of the Model Tax Convention that includes previous reports on the Model Tax Convention).

The 2014 Update does not include the changes included in the discussion draft of 15 November 2013 on Proposed changes to the provisions dealing with the operation of ships and aircraft in international traffic (except for a change to the Introduction); as indicated in that discussion draft, further work is needed with respect to these changes before they are included in the OECD Model Tax Convention.

The 2014 Update also does not include any of the changes put forward in the discussion draft of 19 October 2012 on Revised proposals concerning the interpretation and application of Article 5 (Permanent Establishment); since it is expected that work on Action 7 (Prevent the Artificial Avoidance of PE Status) of the BEPS Action Plan will result in changes to Article 5, the proposed Commentary changes included in that discussion draft will not be finalised until the work on Action 7 has been completed.