The issue often comes down to the character of the income in a cloud transaction, according to IDG. In most cases, it’s either payment for a service, or rental or lease income. The distinction will drive tax rules on both the provider and buyer sides of the transaction.
As more businesses move computing operations to the cloud—nearly three-fifths of respondents to a recent survey by IDG Enterprise had moved at least a portion of their organizations’ IT environments to the cloud—many corporate finance folks still are determining just how the tax regulations come into play. “Cloud business models are relatively new and dynamic,” says Gabe Gartner, principal with consulting firm PwC. “Applying the tax rules to new, ...
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