Increasing globalization has led to a decline in barriers when businesses are looking to expand into new markets around the world. Tax remains one of the central considerations when evaluating a business opportunity. The complexities and intricacies of navigating different tax systems has proven to be a challenge for multinationals that operate in more than one country.
This edition of our annual insight piece is aimed at providing a high-level overview of the tax consequences that face businesses planning to expand international operations.
Understanding the uniqueness of different tax systems presents an opportunity for businesses to plan and structure their affairs in the most tax efficient manner.
In this regard, our current edition responds to the following questions in connection with a multitude of jurisdictions around the globe:
- What is the general overview of the tax system?
- Under what type of legal system (i.e. civil law or common law) does the jurisdiction operate?
- Who are the local taxation authorities?
- What are the different business vehicles that are used by non-residents to carry on business, and what are the tax attributes associated with the different business vehicles?
- What are the different methods of financing a corporate subsidiary? Are there specific tax implications associated with financing through equity or debt?
- What are the different types of corporate income tax to which a corporation may be subject? How is the taxable income of a corporation computed and are there any limitations with respect to allowable deductions?
- Are there any transfer pricing rules and withholding tax implications that might apply to cross-border payments? If so, what are the rules and the tax rates that may apply to different types of cross-border payments?
- What payroll taxes, if any, are payable by an employer and employee?
- Are there any indirect taxes such as sales tax, value-added tax or land transfer tax? If so, what is the rate imposed and when are these indirect taxes payable?
As you will see, the tax considerations that arise when doing business in different jurisdictions are numerous and often complex. The Dentons Global Tax Group can assist you in steering through the changing global tax landscape by providing comprehensive tax advice that is catered to businesses with a global focus.
This issue does not constitute tax advice or a legal opinion. Readers should note that the laws of each jurisdiction are regularly revised or changed, so the statements made in this report are not definitive. However, it does provide a summary overview of the current state of law, and hopefully serves as a useful guide for taxpayers and multinationals to ensure they understand the different provisions and distinctions in various jurisdictions.
We would like to express our gratitude to all the authors and contributors from the various Dentons offices around the world.
Please do not hesitate to contact us should you require further clarification or assistance.
We hope you will enjoy this Global tax guide to doing business in… and look forward to working with you in the near future.