The OECD publishes the 2025 update to the OECD Model Tax Convention

On 19 November 2025, the OECD published the 2025 update to its Model Tax Convention on Double Taxation. Significant changes have been introduced, including some that could be used by tax administrations and courts in relation to the interpretation and application of existing conventions. The most notable change affects the concept of permanent establishment when employees work remotely from their home or similar locations. New cumulative criteria are introduced (50% working time test and commercial motivation test) that companies must consider when assessing permanent establishment status. Important clarifications are also introduced regarding tax residence for the purposes of double taxation agreements signed by the United States, which could affect individuals who are beneficiaries of special tax regimes.

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