international taxation

International taxation deals with taxation aspects of international transactions and the central question of how to determine the identity of the country that has the legal right to tax a person (individual or company) on his portions. The rule in international taxation is that in order to impose a tax on a person, it is necessary to examine what are most of the ties that bind a person to the country to which he owes tax by virtue of law. No matter how many ties a person has to the state, the state can claim a legal right to tax the person on his portions.

according to the OECD organisation, When a commercial activity takes place abroad, or its profits are derived from business carried out in other countries, it may be necessary to pay taxes in these places. The countries of the world have realized that in the era of globalization there is a need to prevent over-taxation imposed according to the tax laws of more than one country. The practice of international taxation is centered on the analysis The conflict that arises between the tax regimes of two countries (a person's country of residence and the country of origin where the income was generated), and in dealing with the consequences of double taxation. Each of the countries involved may tax the same taxpayer, for the same transaction and in relation to the same tax year. The common case is that a person's country of residence taxes him on his worldwide income, even if it was produced in another country, and at the same time the foreign country in which that person produced his income from wages or property within the borders of the foreign country (the "country of origin") also taxes him, since this produced within its scope. In order to avoid double taxation, these countries grant their residents a credit for foreign taxes they paid for income they generated outside the country.


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