International Tax

Many of our clients trade internationally or have offshore subsidiaries or joint ventures. As a result, Moss Adams has a keen understanding of the tax services needed by businesses that operate multinationally. Of course, complex issues arise, but there are also tremendous opportunities—both to reduce tax exposure and to drive greater business success. We recognize the importance of international business growth and partner with our affiliated firm members of PKF International to provide services to multi-national firms or independent business owners who want to expand their business globally.

Systems that tax income from outside the system's jurisdiction tend to provide for a unilateral credit or offset for taxes paid to other jurisdictions. Such other jurisdiction taxes are generally referred to within the system as "foreign" taxes. A credit for foreign taxes is subject to manipulation by planners if there are no limits, or weak limits, on such credit. Generally, the credit is at least limited to the tax within the system that the taxpayer would pay on income from outside the jurisdiction.

Against the backdrop of an increasingly intertwined global economy, international tax compliance and reporting requirements are becoming ever more complex. Today’s companies need sophisticated and agile guidance to maximize planning opportunities and minimize cross-border tax impact. For foreign businesses seeking entry to the U.S. and U.S. businesses competing in a global marketplace, navigating the complexities of international tax rules can be daunting.

We collaborate closely with banking and investment institutions, attorneys with international experience, site selection professionals, and municipal and state development agencies to facilitate international business development. If your company is in the export business, you may qualify for a permanent tax savings through the IC-DISC (Interest Charge-Domestic International Sales Corporation) incentive. This incentive allows you to convert a portion of the profit on your sales from the ordinary income tax bracket to the dividend income tax bracket, significantly lowering your taxes.

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Generally, withholding taxes are imposed on the gross amount of income, unreduced by expenses. Such taxation provides for great simplicity of administration but can also reduce the taxpayer's awareness of the amount of tax being collected.

Therefore, in order to analyze the compliance of the DST with international tax law, the threshold question that must be answered is which tax treaty applies for purposes of the French DST. For 20 years prior to changes first effective in 2007, there were at least nine such categories.

This income includes several categories of portable income, including most investment income, certain resale income, and certain services income. Certain exceptions apply, including the exclusion from Subpart F income of CFC income subject to an effective foreign tax rate of 90% or more of the top U.S. tax rate.

Treaties tend to impose limits on taxation of salaries and other income for performance of services. They also tend to have "tie breaker" clauses for resolving conflicts between residency rules. Nearly all treaties have at least skeletal mechanisms for resolving disputes, generally negotiated between the "competent authority" section of each country's taxing authority. Mexico used to tax its citizens in the same manner as residents, on worldwide income. A new income tax law, passed in 1980 and effective 1981, determined only residence as the basis for taxation of worldwide income.

The group includes all companies that are owned or controlled, directly or indirectly, by the parent company. This essentially means that the DST is imposed on every single company within the group that has generated revenues as defined by the DST. As a result, every company within the group that provides covered services in France can challenge the measure, and the treaties on which to base those challenges depend on the tax residence of the challenging companies. International tax law consists mostly of bilateral income tax treaties concluded between sovereign states.

Armanino is one of the top 25 largest independent accounting and business consulting firms in the United States. Armanino provides an integrated set of audit, tax, consulting, business management and technology solutions to companies in the U.S. and globally. TMF Group is a €2 billion independent global multinational with some 7,800 in-house experts across 120 offices covering 80 plus jurisdictions. With the myriad international tax regulations throughout the world today, it's critical to be compliant when taking your business operations abroad.

To discuss your international tax needs, contact usor a member of the international tax services team. Our expertise comes from decades of hands-on experience, advanced degrees and certifications in all areas of taxation, and our membership in DFK International, a worldwide network of independent accounting firms. We work seamlessly with DFK members around the globe to deliver "boots on the ground service" when and where you need it.

The best of all worlds would be to have senior tax specialists from key foreign jurisdictions available here in the United States – pros who understand the overall tax context of your company along with the tax technical issues specific to the foreign country. U.S. international tax rules are continuously evolving, which means we are always working to stay current and on the leading edge of these developments. Our tax professionals understand the complexities of cross-border transactions, the tax impact of cash management, as well the tax implications of various legal structures. As a result, we adeptly assist with the compliance requirements of international business operations, as well as aid companies in proactive international tax planning. Such "transfer pricing" issues also arise in the on-going operations of MNEs or in relation to non-M&A investment and expansion.

Whether you are monitoring the distribution of goods and services across international borders or helping provide tax savings to U.S. exporters from across the globe, our team of trusted international tax advisors can help with intricate global tax requirements. The best time to understand the impact of transfer pricing on your business, tax footprint, and financial statements is before you’ve committed to expansion or restructuring. And if and when documentation is needed, we provide a straightforward approach to compliance. One of the challenges of competing in a global marketplace is optimizing your international workforce.

UK rules provide for separate limitations based on the schedule of income on which UK tax is computed. Thus, credits were separately limited for salaries versus dividends and interest. In the United States, rules provides that U.S. shareholders of a Controlled Foreign Corporation must include their shares of income or investment of E&P by the CFC in U.S. property. U.S. shareholders are U.S. persons owning 10% or more of a foreign corporation. Such persons may include individuals, corporations, partnerships, trusts, estates, and other juridical persons.

Some systems have rules for resolving characterization issues, but in many cases resolution requires judicial intervention. Note that some systems which allow a credit for foreign taxes source income by reference to foreign law. Bulgaria used to tax its citizens on worldwide income regardless of where they resided. A new income tax law, passed in 1997 and effective 1998, determined residence as the basis for taxation of worldwide income. Specifics are intended as examples, and relate to particular governments and not broadly recognized multinational rules.

To capture tax savings opportunities and maximize your position in a shifting landscape, rely upon the deep knowledge of Friedman’s International Tax Services team. In 1993, Henry+Horne recognized that mid-sized CPA firms needed to start ramping up efforts to serve clients with international tax needs.

With clients in more than four dozen countries, our expertise in international tax issues is unmatched. We help clients minimize tax, whether they’re U.S. citizens with interests overseas, non-resident aliens with business operations in the United States, or high net worth non-residents with investments in U.S. real estate. In addition, our international tax experts have experience helping organizations comply with the Foreign Account Tax Compliance Act . Through our membership in Baker Tilly International, we have affiliates throughout the world to assist with local law and on-the-ground support.

The United Kingdom provides that a UK company is taxed currently on the income of its controlled subsidiary companies managed and controlled outside the UK which are subject to "low" foreign taxes. Low tax is determined as actual tax of less than three-fourths of the corresponding UK tax that would be due on the income determined under UK principles. Further, there are certain exceptions which may permit deferral, including a "white list" of permitted countries and a 90% earnings distribution policy of the controlled company. Treaties tend to provide reduced rates of taxation on dividends, interest, and royalties. They tend to impose limits on each treaty country in taxing business profits, permitting taxation only in the presence of a permanent establishment in the country.

With respect to international tax law, companies can challenge the DST based on bilateral income tax treaties. The applicable tax treaty and available claims depend on the challenging company’s country of residence. Saudi Arabia taxes the local business income of its residents who are not citizens of Gulf Cooperation Council countries and of nonresidents. It also imposes zakat on the worldwide business income and assets of its residents who are citizens of Gulf Cooperation Council countries. Saudi Arabia does not impose tax or zakat on income or assets that are not related to business activities.

The credit may be limited by category of income, by other jurisdiction or country, based on an effective tax rate, or otherwise. Where the foreign tax credit is limited, such limitation may involve computation of taxable income from other jurisdictions. Such computations tend to rely heavily on the source of income and allocation of expense rules of the system. Where differing characterizations of an item of income can result in differing tax results, it is necessary to determine the characterization.

Trapped and deferred loss planning could allow you to obtain a deduction in the United States for foreign operation losses and built-in offshore losses. Proper planning in this area can help you manage your cash flow, overall tax liability, and effective tax rate for financial statement reporting purposes; it can also help your bottom line. Our International Tax group can support all tax aspects of your international businesses, including foreign taxation, financing arrangements, sourcing, import-export considerations, and new markets.

This includes issues such as expatriate benefits, federal and state taxes, tax equalization calculations, payroll compliance, and compensation reporting. We work with you to design a strategy that provides a return on the investment you make in people. As it turns out, not every company is fully compliant with the various reporting and disclosure laws for the jurisdictions in which they operate. When under audit by a taxing authority, most make the assumption that valuations are understated and start down the path of making adjustments and asserting penalties. Additionally, your service providers must understand all the options available to mitigate the global tax impact of adjustments and penalties.

Many jurisdictions require persons paying amounts to nonresidents to collect tax due from a nonresident with respect to certain income by withholding such tax from such payments and remitting the tax to the government. These requirements are induced because of potential difficulties in collection of the tax from nonresidents. Withholding taxes are often imposed at rates differing from the prevailing income tax rates. Further, the rate of withholding may vary by type of income or type of recipient. Generally, withholding taxes are reduced or eliminated under income tax treaties .

From businesses going global to individuals living abroad, the international world was no longer limited to the Fortune 500. Nearly 25 years later, the firm’s international tax clients have grown from just a handful to working with businesses and individuals all over the world.

With clients in more than 50 countries, MBAF has the international tax experience to define global tax strategies that minimize your tax liability worldwide. Plus, if they live in the foreign country, will they understand how foreign tax law relates to your most important U.S. tax issues?

These professionals offer international tax planning, compliance, and advisory services to ensure that tax practices meet defined business outcomes. It is most likely that the DST is not identical or substantially similar to the enumerated taxes because—although the tax is borne by companies—it is imposed on the supply of digital services without regard to the economic situation of the supplier. It is different from the French company tax or the other enumerated taxes that vary depending on the profitability of the target company or individual. By the same token, as a tax on total revenue of companies regardless of their profit margin, the DST is also not a tax on income or elements of income and thus fails to qualify as a tax covered by Article 1 of the Treaty.

The principal role of our international tax lawyers is to design legal structures for our clients’ cross-border transactions and investments. We help structure legal entities and contractual arrangements to minimize host-country and home-country taxation. This often involves the use of intermediate holding companies and finance companies to reduce host-country taxation or to defer home-country taxation. When tackling the complexities of international tax compliance reporting and other nuanced issues, gain insight and reduce uncertainty with the help of our global network of international tax specialists. The DST’s implementing legislation provides that the tax should be assessed at the group level.

BKD annually prepares thousands of tax returns for individuals, various types of businesses, trusts, and tax-exempt entities. BKD can assist your organization with tax planning and international imports for inbound services. When planning cross-border operations, are you factoring in all relevant international tax considerations?

Our specialists have technical and hands-on experience evaluating business restructuring or business rationalization and determining the resulting tax implications. We also have a dedicated China Practice 中国业务 with bilingual professionals who can handle all your inbound and outbound needs. Strategic international tax planning is necessary to excel in a global economy. As an international tax CPA firm, FJV can help your company develop an overall global tax strategy that facilitates your global business objectives, makes good business sense, and is practicable.

Weaver’s International Tax team has years of experience in export incentives, and can help your business use IC-DISCs to achieve significant tax savings. We can determine if your company is eligible for the incentive, and if it is, help you navigate the complex rules and procedures for setting up and maintaining an IC-DISC.

Our international tax experts will help you navigate the complexities of reporting and paying taxes in multiple countries, reducing your tax burden as you pass along your estate to your heirs. Ryan’s highly experienced global tax specialists employ proven methodologies to identify and reclaim any withholding tax that has been overpaid, utilizing a solution that is unique to the industry. Our analysis is comprehensive, covering third party and intercompany transactions, as well as the associated credits and withholding taxes. Ryan’s state-of-the-art technology, coupled with our service process, provides an enhanced, highly detailed, end-to-end global review, so our clients’ profits stay where they belong.

International tax planning for specific situations can then be approached in a strategic manner focusing on the company’s broader global tax, finance, and operating strategies. If you or your organization work internationally, Weaver can give you local service on a global scale. Wherever your business or your employees are from or wherever you are doing business – from Argentina to Zimbabwe – Weaver is there. If your business is multinational, our International Tax team can create a tax planning strategy that is fully integrated with your global strategy. Dynamic, diverse, and highly experienced in helping financial services organizations with their international tax structuring.

EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. Our international tax lawyers often represent project consortia and other joint ventures among investors from multiple countries. These investments typically present challenging structuring issues due to the effects of differing tax rules in the venturers’ home countries.

KPMG’s International Tax professionals provide the vast knowledge and practical experience to help companies looking to invest across borders for the first time or expand their existing international footprint. With a broad range of services and a thorough understanding of tax and trade regulations, our specialists deliver the essential technological and advisory support for multinational organizations. International estate tax planning – Multiple jurisdiction estates require careful planning.