What are the primary types of international tax structures?

International tax structures are the different ways in which governments in different countries tax business income earned abroad. Generally, there are two primary types of international tax structures: territorial and residence-based taxation. Territorial taxation is when income earned within a certain country is taxed at the domestic rate on that income, regardless of where the company is based. This international tax structure is beneficial for companies that work in multiple countries and want to avoid double taxation. Residence-based taxation, on the other hand, is when income is taxed based on where the company is based, rather than the country where the income is earned. This structure can be beneficial for companies that have a large presence in one country, and their income will be taxed based on the laws of that country in which they are based. In North Dakota, the taxes on income earned abroad for individual taxpayers are a bit more complicated, as they are subject to both the territorial and residence-based taxation structures. The amount of international income that a taxpayer is required to report is dependent on their residency status, and the income earned abroad is subject to either the territorial or residence-based taxation structure.

Related FAQs

How do governments tax corporate income?
What is the role of Transfer Pricing for taxation of international profits?
What are the primary types of international tax structures?
How do Double Taxation Treaties help avoid double taxation?
What is the taxation of foreign trusts?
What are the specific implications of the USA's Foreign Account Tax Compliance Act (FATCA)?
How do avoidance of double taxation agreements work?
What is the taxation of intra-group transactions?
What is the taxation of foreign financial assets?
How does taxation of foreign dividends work?

What are the primary types of international tax structures?

Related FAQs

Related Blog Posts