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One of the primary concerns in international taxation is the issue of double taxation, where the same income or profits are subject to tax in multiple jurisdictions. We recognize that countries often enter into double-tax treaties that allocate taxing rights and provide mechanisms to relieve or eliminate double taxation.
Determining an individual or entity's tax residency is crucial in international taxation. Tax residency rules vary among countries and can impact the individual's or entity's tax obligations. Additionally, we assist in establishing the source of the income to determine the appropriate jurisdiction for taxation.
Transfer pricing refers to pricing cross-border transactions between related entities within multinational corporations. It involves setting prices for goods, services, or intellectual property transferred between associated entities in different jurisdictions. Transfer pricing rules ensure that transactions between related parties are conducted at arm's length, preventing tax avoidance and allocating profits appropriately across jurisdictions.
Many countries have CFC rules that aim to prevent shifting profits to low-tax jurisdictions by using foreign subsidiaries. These rules attribute the income of certain foreign entities to the shareholders or parent company, subjecting them to tax in the home country.
Tax treaties are agreements between countries that prevent double taxation and provide mechanisms for exchanging information and cooperation in tax matters. They help determine which country has the primary right to tax certain types of income and provide tools for resolving disputes between nations.
They were withholding taxes on cross-border payments, such as dividends, interest, royalties, or service fees. These taxes are usually withheld at the payment source. They may be subject to reduced rates or exemptions based on tax treaties or domestic laws.
International taxation involves complex compliance and reporting obligations. Compliance with these reporting obligations is essential to avoid penalties and ensure transparency in tax matters.