When goods, services and rights go back and forth within a company, how do you attribute profit or loss to one part of the company versus another? Former OECD head of tax treaties and transfer pricing Mary Bennett and EY’s Mike McDonald join this episode of “GILTI Conscience” for a detailed discussion on the attribution of profits to permanent establishments. Skadden tax partners David Farhat and Nate Carden and associate Stefane Victor host the discussion, which explores, among other topics, critical differences between Articles 7 and 9 of the OECD Model Tax Convention and why these distinctions matter for multinational businesses. 

💡 Featured Guests 💡

Name: Mary Bennett

What she does: Mary worked in private practice before joining the Office of International Tax Council at Treasury. She spent six years as the head of tax treaties and transfer pricing at the OECD in between two stints as a partner at Baker McKenzie before retiring in 2022.

Organization: Formerly OECD and Baker McKenzie

Words of wisdom: "The AOA recommends that companies create internal documentation of how their situations should be characterized, and countries should follow that documentation unless it clearly doesn't reflect reality.”

Connect: LinkedIn

Name: Mike McDonald

What he does: Mike spent multiple stints at Treasury and EY, currently serving as managing director of International Tax and Transactions,Transfer Pricing at EY.

Organization: EY

Words of Wisdom: “I think the best primer on profit attribution in general is Chapter One, or Part One, of the AOA.”

Connect: LinkedIn

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GILTI Conscience is a podcast by Skadden, Arps, Slate, Meagher & Flom LLP, and Affiliates. Skadden’s tax team is recognized globally for providing clients with creative and innovative solutions to their most pressing transactional, planning, and controversy challenges. The insights and views presented in GILTI Conscience are for general information purposes only and should not be taken as legal advice for any individual case or situation. The information presented is not a substitute for consulting with an attorney, nor does tuning into this podcast constitute an attorney-client relationship of any kind.