Double Taxing

Dictionary Says

Definition of 'Double Taxing'


A tax law that causes the same earnings to be subjected to taxation twice. A company's income is taxed initially at the corporate level and then the shareholders and investors are taxed on the distributions they receive from the company. Double taxation is argued by many to be an unfair and inefficient method of taxation in many countries and jurisdictions.

Investopedia Says

Investopedia explains 'Double Taxing'


While in most cases double taxation relates to company profits and shareholder gains, it can also be the case for dividends. Double taxation can also occur in situations where a company has subsidiaries operating in different countries, where that country may tax the subsidiary and the parent firm is then taxed on the remaining profits in its domestic country. This can then be followed by the taxation of shareholders on any capital gains they experience from holding the stock.



comments powered by Disqus
Hot Definitions
  1. Closed-End Fund

    A closed-end fund is a publicly traded investment company that raises a fixed amount of capital through an initial public offering (IPO). The fund is then structured, listed and traded like a stock on a stock exchange.
  2. Payday Loan

    A type of short-term borrowing where an individual borrows a small amount at a very high rate of interest. The borrower typically writes a post-dated personal check in the amount they wish to borrow plus a fee in exchange for cash.
  3. Securitization

    The process through which an issuer creates a financial instrument by combining other financial assets and then marketing different tiers of the repackaged instruments to investors.
  4. Economic Forecasting

    The process of attempting to predict the future condition of the economy. This involves the use of statistical models utilizing variables sometimes called indicators.
  5. Chicago Mercantile Exchange - CME

    The world's second-largest exchange for futures and options on futures and the largest in the U.S. Trading involves mostly futures on interest rates, currency, equities, stock indices and agricultural products.
  6. Private Equity

    Equity capital that is not quoted on a public exchange. Private equity consists of investors and funds that make investments directly into private companies or conduct buyouts of public companies that result in a delisting of public equity.
Trading Center