E-commerce and tax: E-commerce and income tax
Example B
New Zealand business sets up a website hosted by an overseas ISP.
Selling tangible and intangible products
As in Example A, a New Zealand book publisher sells tangible and intangible products but sets up its website hosted by an Australian ISP. Customers find products, place orders and pay for purchases online. Delivery of the products can be made:
- online by downloading the books, and
- through normal physical delivery channels.
What is the business's tax liability?
As the website is hosted by an ISP overseas it is not a permanent establishment in that country,so no profit should be attributed to that country.
All worldwide business income must be returned for New Zealand taxation purposes.
Date published: 03 Dec 2007
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