A tax treaty, also known as a Double Taxation Agreement, is a crucial bilateral agreement between two countries. These international accords aim to prevent...
A tax treaty is a bilateral agreement between two countries designed to prevent individuals and businesses from being taxed twice on the same income or capital by both nations, fostering cross-border economic activity.
The main goals include preventing double taxation, reducing tax evasion, promoting international trade and investment, and providing mechanisms for resolving tax disputes between treaty partners.
They offer relief from double taxation, provide clarity on tax obligations in foreign jurisdictions, can reduce withholding taxes on certain income types (e.g., dividends, royalties), and establish dispute resolution procedures.
No. While often based on international models (like the OECD Model Convention), each tax treaty is unique, with specific provisions negotiated between the two signatory countries, reflecting their individual economic relationships.