International taxation

🌐 What is International Taxation?

International Taxation deals with how income earned across borders is taxed — especially when a person or business is involved in more than one country’s tax system.

It ensures that:

• Countries collect fair tax revenue

• Individuals & companies don’t pay tax twice (Double Taxation)

• Businesses follow global tax compliance laws

✅ Key Aspects of International Taxation

1️⃣ Residential Status & Global Income

If you’re a resident Indian, you’re taxed on global income.
If you’re an NRI, only income earned or received in India is taxed in India.

2️⃣ Double Taxation Avoidance Agreement (DTAA)

India has DTAA treaties with 90+ countries (like the US, UAE, UK, Singapore).
This helps you avoid being taxed twice on the same income in both countries.

3️⃣ Taxation of Foreign Income

• Foreign salaries, investments, or business income may be taxable

• NRIs may need to declare assets outside India if they later become residents

• Foreign Tax Credit (FTC) is available for tax already paid abroad

4️⃣ Transfer Pricing Rules

For businesses operating in multiple countries (like MNCs), pricing of cross-border transactions between related entities must follow fair market value — to prevent profit shifting.

5️⃣ Global Reporting & Compliance

• FATCA, CRS, and FEMA reporting is mandatory for foreign asset holders

• Not complying can lead to heavy penalties and audits