Double Tax Treaties
Using Double Tax Treaties to avoid UK Tax
Double tax treaties are agreements between different countries that apply to determine which country shall tax certain forms of income and gains. The provisions though are much wider than this, and they can also be used to determine an individuals or company's tax residence.
The need for double tax treaties arises because many countries tax both the income of their residents as well as any income arising in their borders. So a resident in one country (France) may be taxed by France on his worldwide income.
However if some of his income arose in the UK, the UK may also want to tax the income arising within the UK. This could lead to the same income (ie the UK income) being taxed twice. This is where double tax treaties come into play, and they could provide for either an exemption from tax in one of the country's or a tax credit to offset against the other country's tax liability.
This section includes articles that cover the use of double tax treaties.
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Articles on Double Tax Treaties