Plain meaning
A model treaty and commentary used by many countries as a reference point when negotiating and interpreting income tax treaties.
Also called
OECD model convention
OECD model treaty
Key points
- The model is not itself a Canadian tax treaty, but it influences treaty wording and interpretation.
- The commentary can help courts, tax authorities, and practitioners understand treaty language.
- Actual treaty text can differ from the model, so the signed treaty always matters.
- Updates to the model and commentary can influence future negotiations and sometimes interpretive debates.
Why it comes up
The OECD Model helps explain treaty concepts such as residence, permanent establishment, business profits, dividends, interest, royalties, and capital gains.