International and domestic aspects of double taxation

International and local aspects of double taxation Abstract The purpose of my thesis is to analyze international double taxation taking into account both local legislation and international aspects. Double taxation is the situation, where the same income (or capital) is subject to the same tax more than once. Mostly, the international double taxation appears when the state of the source of income implies taxes on the income of the non-residents and the state of residence of the income receiver subject the same income to taxation based on the residency of the taxpayer. Since this is inequitable, many nations make bilateral double taxation agreements with each other. In some cases, the tax is paid in the country of residence and is at the same time exempt in the country in which it arises directly based on the provisions of double taxation agreement. In the remaining cases, the country where the gain arises implies taxation at source and the taxpayer receives a compensating foreign tax credit/foreign taxation exemption in the country of residence to reflect the fact that tax has already been paid. The thesis is divided into seventeen chapters that could be divided into five main parts. The first part is aimed at the description of basic terms used in international taxation and basic principles of the system..