INTERNATIONAL TAXATION

“Tax optimisation is our motivation”

Bar a number of exceptions, direct taxation is still mostly subject to the sovereign power of individual states and every state jealously guards its sovereign right to tax its residents or income sourced within its jurisdiction. The science of international taxation deals with the overlap and interaction of the taxing powers of sovereign states in the presence of cross-border taxable events. In today’s globalized world, the opportunities for cross-border transactions have boomed but most countries’ tax systems have not changed as quickly. This creates the risk of double or multiple taxation as well as tax mitigation opportunities for businesses operating cross-border.

Companies, entrepreneurs and estates having cross-border business activities and interests must be well advised on the potential pitfalls of international double or multiple taxation as this could have devastating effects on their financial goals. On the other hand, not taking advantage creatively of international tax mitigation opportunities will almost certainly mean the loss of a competitive advantage for businesses. International tax planning is the art of legally making the best possible use of the opportunities created by such interaction whilst avoiding the pitfalls.

International tax planning requires detailed legal and practical knowledge of the international tax aspects of each country’s international tax system effecting a particular situation or transaction. One must also be aware of countermeasures against adopted by high tax countries against what is perceived as harmful tax competition and abusive tax planning. There has never been a time where international tax arbitrage has been so much under fire both at a European and international level. The move towards Automatic Exchange of Information and initiatives like BEPS by the OECD mean that taxpayers active cross-border will be faced with an evolving legal environment aimed at discouraging and preventing confidential transactions and international structures that give priority to form over substance in order to obtain a tax advantage.

Corrieri Cilia was set up with the principal aim to provide high quality tax and legal assistance to clients involved in international trade and business transactions. Our team of international tax lawyers can assist you in structuring international business transactions in the most effective and tax efficient manner in line with the latest international tax and legal developments in Malta and elsewhere.

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