Bilateral Tax Agreement

AAA

DEFINITION of 'Bilateral Tax Agreement'

An arrangement between two jurisdictions that mitigates the problem of double taxation that can occur when tax laws consider an individual or company to be a resident of more than one jurisdiction. A bilateral tax agreement can improve the relations between two countries, encourage foreign investment and trade, and reduce tax evasion.

INVESTOPEDIA EXPLAINS 'Bilateral Tax Agreement'

Bilateral tax agreements can deal with many issues such as taxation of different categories of income (business profits, royalties, capital gains, employment income, etc.), methods for eliminating double taxation (exemption method, credit method, etc.), and provisions such as mutual exchange of information and assistance in tax collection.

RELATED TERMS
  1. Tax Shelter

    A legal method of minimizing or decreasing an investor's taxable ...
  2. Tax Treaty

    A bilateral agreement made by two countries to resolve issues ...
  3. Tax Home

    The general locality of an individual's primary place of work. ...
  4. Tax Liability

    The total amount of tax that an entity is legally obligated to ...
  5. Tax Evasion

    An illegal practice where a person, organization or corporation ...
  6. Organization for Economic Cooperation ...

    A group of 30 member countries that discuss and develop economic ...
Related Articles
  1. Retirement

    Tax Tips For The Individual Investor

    We give you seven guidelines to help you keep more of your money in your pocket.
  2. Taxes

    Surviving The IRS Audit

    Keeping thorough records and knowing the penalties make this experience easier than you'd expect.
  3. Taxes

    Using Tax Lots: A Way To Minimize Taxes

    The method of identifying cost basis can help you to get the most out of reduced tax rates.
  4. Personal Finance

    Pros And Cons Of Offshore Investing

    Tax loopholes are shrinking, but there are still plenty of viable prospects. Get the big picture.
  5. Taxes

    3 Common Tax Questions Answered

    We clarify some rules that often puzzle taxpayers.
  6. Taxes

    Taking A Look At Tax Havens

    These tax-free zones might sound appealing, but the consequences often aren't.
  7. Taxes

    Tax Court: Your Last Resort

    Appealing an unfavorable or unfair tax ruling may be your last chance to save your finances.
  8. Stock Analysis

    Why Should Investors Read The Annual Reports?

    All investors should read each year the annual report from their top stocks, which contains valuable information and facts they weren't probably aware of.
  9. Economics

    Iron Ore Market: Falling Into The Hands Of A Few

    The big iron ore mining companies have embarked on a drive to increase supply, reduce cost, and take market share.
  10. Economics

    Are Greece’s Worries Almost Over?

    Last week ended with the news that Greece and the European Union (EU) finance ministers struck a deal to temporarily extend the Greek bailout program.

You May Also Like

Hot Definitions
  1. Fixed Cost

    A cost that does not change with an increase or decrease in the amount of goods or services produced. Fixed costs are expenses ...
  2. Subsidy

    A benefit given by the government to groups or individuals usually in the form of a cash payment or tax reduction. The subsidy ...
  3. Sunk Cost

    A cost that has already been incurred and thus cannot be recovered. A sunk cost differs from other, future costs that a business ...
  4. Technical Skills

    1. The knowledge and abilities needed to accomplish mathematical, engineering, scientific or computer-related duties, as ...
  5. Prepaid Expense

    A type of asset that arises on a balance sheet as a result of business making payments for goods and services to be received ...
  6. Gordon Growth Model

    A model for determining the intrinsic value of a stock, based on a future series of dividends that grow at a constant rate. ...
Trading Center