Taxation Law Articles
Articles written by attorneys and experts worldwide
discussing legal aspects related to Taxation.
When assessing the value of a property because of the duty to disclose information and pay gains in divorce proceedings, the costs incurred are not tax deductible.
It was reported in the past weeks that a “total of 320 professionals who have taken up residence in Malta are benefiting from a maximum tax rate of 15% on their €75,000-plus salaries”.
Under certain circumstances, inheritance tax charged in another country cannot be deducted or considered as a liability against the capital assets of a German testator.
One of the most common questions often asked of corporate attorneys by small business owners who are just setting up their first company is how to write off expenses. Usually, two of the most important expenses these people want to write off are meals and entertainment expenses.
If inheritance tax paid in a foreign country is not meant to be deductible in Germany, it is disregarded when the German inheritance tax is calculated.
In 2012, with the dreaded “Fiscal Cliff” looming, many were worried about the inaction that would cause the estate tax exemption level to fall to $1 million. However, in the first two days of the new year, Congress finally passed the American Taxpayer Relief Act of 2012 (ATRA) which makes permanent the $5 million exemption as well as portability.
The American Taxpayer Relief Act of 2012 (ATRA) extended and made permanent (i.e., until Congress changes its mind) a number of key estate tax provisions. This includes a $5 million ($5.25 including inflation) estate tax exemption and portability of a deceased spouse’s exemption to the surviving spouse. The result of this means that married couples can shelter up to $10.5 million of their estate from federal taxes.
The Supreme Court’s recent decision to allow same-sex couples to receive marriage benefits raised several questions that left many lawmakers, financial institutions and individuals anxious for answers. Now, finally, the IRS has issued guidance in Revenue Ruling 2013-17. A Revenue Ruling is the IRS’s interpretation of the law.
Due to disparities that must be calculated, investors in shipping funds may have to wait a long time before benefiting from expected tax savings.
If you have already been sued, it is probably too late to do anything to protect your assets. But, if you are a planner and looking to protect your assets before you have a problem, this article is for you.
This article provides a brief introduction to the German inheritance tax.
Cyprus had been the first Member State to experience and implement the resolution and bail-in approach with respect to failing banks, thus relieving taxpayers and direct investors from suffering the burden of rescuing failing, bad-managed banks. But there can be no doubt that Cyprus is a jurisdiction actively protecting foreign direct investment at the highest levels.
Congratulations on your decision to start a new business. The question you may be asking, though, is what kind of business you should form? What is the difference between a corporation, an LLC, and a partnership? Why form one and not another?
The confidentiality of tax information is privately agreed, but this does not prevent the collection of information from a tax investigation subsequent to request for confidential information.
Double tax treaties provide for relieving double taxation; sometimes double taxation relief is extend to tax paid by foreign subsidiaries and other foreign affiliates in terms of economic definition.
On the 29th July 2013, the VAT Department published guidelines in relation to the Malta VAT treatment of short-term yacht charters starting in Malta, which guidelines are largely similar to the interpretation which applicable to long-term yacht leases.
Following the launch of the Global Residency Program earlier this month, the Government has (by means of Legal Notice 178 of 2013) amended the HNWI Rules.
The old English proverb says, “There are only two things in life that we can’t avoid, death and taxes,” – and it confirms once again the value and importance of the tax due diligence procedure as one of crucial attributes of most M&A (mergers and acquisitions) transactions.
Acknowledging the importance of the IT sector in Ukraine’s economy, the government has provided tax breaks to qualified companies and individuals in the IT sector that fall under the category of "subjects of the software product industry". From the period of January 1, 2013 until January 1, 2023, qualified IT companies and individuals are subject to a reduced profit tax rate of only 5%, provided they maintain a separate accounting of income and expenses of their activity in this sphere.
Almost twenty years have passed since the enactment of Law 8 of 1994, which until the end of the year 2012 regulated tourism investments and incentives in the Republic of Panama. This body of law responded to a national strategy and a master plan oriented towards promoting tourism related investments in Panama.
The 2013 Global Residence Program Rules have been finally published. Conversely as what has been expected however, these Rules are only applicable to non-Maltese, non-EEA and non-Swiss nationals.
Voluntary Disclosure in Relation to Untaxed Income Received from Service Fees Charged to an Agency - Germany
Reportedly, a number of university-level professors have voluntarily made disclosures in relation to untaxed income received as service fees charged to a PhD conferral mediation agency.
The Metropolitan Court passed a strange judgement in a recent case. According to the judgement, taxpayers cannot argue that they used arm’s-length price in their transaction with their related companies if the corresponding transfer pricing document does not meet the legal requirements.
Legal Notice 152 of 2013, has brought into effect amendments to the Highly Qualified Persons Rules, applicable retrospectively from the 1st of January 2013.
Tax avoidance like tax evasion is a worldwide phenomenon, prevalent in all countries including Cameroon. It is not a modern device, neither merely resulting from the present day imposition nor necessarily brought about by the strong and popular resentment of taxation. The origin o f tax avoidance can be traced to the thirteenth and fifteenth centuries England where the “Use” and the ‘’Trust’ were employed to avoid the incidence of manorial tenure.
Financial criminal offenses may occur more readily and more frequently than most people expect. In a recent decision, the BGH seems to have tightened its jurisdiction on tax misdeeds.
Sales tax is a tax incurred when deliveries or other services are exchanged. For this reason, sales tax is incurred with respect to nearly every service and every product.
An overview of key developments affecting doing business in Angola and an introduction to its legal system for foreign investment, currency regulations and incentives, business vehicles and relevant restrictions and liabilities. It provides short overviews on the laws regulating employment relationships including redundancies and on competition law, data protection, product liability/safety, taxation/tax residency and IP rights over patents, trade marks, registered and unregistered designs.
The German Federal Supreme Court (BGH) is said to have tightened its jurisdiction on tax offenses in a recent ruling. In some cases, a suspended sentence is excluded.
Whether real estate is being acquired entirely new in the context of property acquisition or if it was already in the partnership’s possession is an important fact.
In the judgement S&D Yachts Limited vs MY Nautonnier delivered by the Court of Magistrates in Malta on the 3rd May 2013, it was held among other things that a vessel registered as a commercial yacht was not automatically entitled to an exemption from VAT.
India and Malta renegotiated the Double Taxation Avoidance Agreement (DTAA) between the two countries with the intention of aligning to changes in domestic laws.
The Federal Court of Justice (BGH) has seemingly tightened the jurisprudence on tax evasion. This shall particularly concern tax evaders who have failed to pay tax on multi-million euro amounts.
The 2013 amendments to the VAT legislation brought about changes to the place of supply rules in relation to long-term leases of yachts (leases for more than 90 days) to a non-taxable person.
Territoriality Tax Rule or Territorially tax system means “Do not pay taxes in Panama incomes for offshore source”, is a major fiscal benefits for foreign investors, however the country was victimize for Criminal Organization, choosing our jurisdiction for laundry money activities.
A business can potentially be acting anti-competitively if the notice of included sales tax only becomes visible after clicking on the button “shipping and payment options”.
Up to now, it was not clear from a tax law perspective whether accrued property transfer tax constitutes incidental acquisition costs or an expense that is immediately tax deductible when there is a change to the composition of partners.
The BFH has quashed constitutional doubts concerning the 1%- rule on the basis of the gross list new price.
Thailand is recovering from historic floods that inundated the country on a scale never seen before. Drastic taxation measures helped to boost the economy in 2012. Despite uncertainty about the evolution of the global economy, the Thai economy is expected to rebound sharply with GDP growing by 5.5% in 2012 and 5% in 2013 (according to The World Bank).
Delay in Application of Uniform Act Organizing and Harmonizing Company Accounting Systems - Democratic Republic of the Congo (DRC)
The entry into force of the OHADA Treaty in the Democratic Republic of the Congo (DRC) resulted in the immediate application of the Treaty, its Regulations and Uniform Acts. It also led to the repeal of any DRC anterior legal instruments contrary to the Treaty and its Uniform Acts.
The audit of the authenticity of invoices has been one of the primary inspection targets for the National Tax and Customs Administration (NAV) during the last few years. Despite the numerous Hungary-related decisions of the European Court of Justice last summer, the legislator introduced a series of year-end tax law changes that will allow the tax authority to maintain its current practice.
The Internal Revenue Service Criminal Investigation Division serves the American public by conducting criminal investigations regarding alleged tax violation and various money laundering statutes. The IRS is the only federal agency that can investigate potential criminal violations of the Internal Revenue Code. There is a long, complicated investigation process involving many levels of personnel that goes into prosecuting these types of criminals.
The Hawaii Department of Taxation has announced its goals for 2013, and the #1 goal is to increase voluntary compliance. The Department is going to focus its outreach and enforcement efforts on non-compliant groups, including non-residents and persons "new" to the tax system.
The new Inheritance and Gift Tax Act that came into force on 1 January 2009 with the reform to inheritance tax is to be re-examined with respect to its constitutionality.
It is wise to know what the tax changes are when planning for the next tax season. Following are a few of the changes for 2013 that could affect the amount of taxes that you will pay.
High-net-worth individuals with valuable possessions around the globe need effective asset protection tools to manage and safeguard their wealth, as a respond to the differing legislations and tax regulations of the various jurisdictions.
In Australia, failure to comply with taxation laws can lead to a Commonwealth criminal charge. What happens if you are found guilty and what penalty can you receive? Know the law for this offense and what you should do if you are charged.
Tax avoidance versus tax evasion has always been a hotly debated subject. The difference between tax avoidance and tax evasion is very narrow. Nowadays tax laws are being drafted in a manner to diminish the possibilities of tax avoidance though, yet tax planning offers many avenues to reduce tax liability. From this perspective, the study to differentiate between tax evasion and tax avoidance is interesting and noteworthy.
The world of law, tax and real estate continue to become more and more complex. Costs can be a strong deterrent to a person seeking professional advice. Wischmeyer Professional Services Access Plan allows employers to provide valuable resources to their employees at minimal cost and can even benefit themselves. Access to free consultations with an attorney, accountant or real estate agent with discounts if services are needed for professional resources and services.
The re-election of President Obama ensures that the Affordable Care Act (“ACC”) will be implemented. The ACC imposes obligations that most individuals maintain health care coverage. Individuals who fail to comply with the law are subjected to penalties in the form of excise taxes. For permanent residents who may maintain coverage provided by a foreign company or government and for expatriates living abroad, the individual mandate creates a number of potential issues and concerns.
In view of world wide economic integration, the international aspect of income taxation has become increasingly important. This note provides an introduction to the policies that countries seek to advance. The questions of source, jurisdiction and distinction between resident and non-resident from the perspective of international taxation are an important issue and in this perspective tax treaties and related instruments have been reviewed.
Many Americans live in fear that the dreaded IRS man will come knocking with in-home income tax audits. The truth of the matter is that the auditing process usually begins with a letter or a phone call that you must respond to.
Income tax return preparers may be subject to a number of general penalty provisions as well as specific preparer penalties aimed directly at them. Beware getting yourself into a position of having overstated deduction areas repeatedly. You can lose your right to prepare returns if you do.
The gift tax exists because of the fact that people logically transfer assets to their future heirs while they are still alive in order to avoid the estate tax at their death
By MMLC Group
Foreign investors need to understand China's indirect taxes, especially its withholding taxes and VAT reforms. China relies greatly on these for its revenue base, thus enforcement of these taxes is strict. This article reviews these indirect taxes and identified major current issues.
Malta’s position within the financial services, gaming and aviation sectors, is further bolstered by the newly introduced 15% flat tax rate on; income derived from employment in Malta, by persons not domiciled in Malta and working in either of the ‘eligible offices’ as defined by the HQP Rules. With a minimum annual tax payable of € 11,250, equating to a 15% tax rate being applied to an income of € 75,000, tax planning has become a lot simpler.
The VAT Department in Malta has issued guidelines relating to aircraft leasing. The guidelines which are based on the current yacht leasing measures, seek to mitigate the VAT impact on the purchase of an aircraft and its engines.
Until recently, residential property owners in Ukraine did not need to pay any property tax whatsoever. At long last, however, the government has passed legislation designed to remedy this significant loophole in its ongoing tax collection efforts.
Inheritances may possibly expire at the end of the year, because of a legislation alternation in compliance with the inheritance reform. The reform of 2010 changed the actual guidelines and may even display its effects for the first time this coming year. On the 10.09.2010 the new inheritance and also limits legislations grew to be useful.
In order to regulate the levy of Sales Tax on services provided, rendered, initiated, received or consumed in the province of Sindh, the provincial government enacted, The Sindh Sales Tax on Services Act, 2011,1 which became enforceable from the first day of July 2011.2
Even inheritors of tax evaders should eventually take criminal prosecution against them into account, since more and more tax investigations due to fiscal fraud were lately brought to light. It seems that a stricter pursuit of tax evaders is to be expected.
General principles on ‘Taxability’, ‘Jurisdiction’, ‘Taxable person’, ‘Taxable event’, Taxable supply, Tax exemption, Adjustments, etc bear a common phraseology among different jurisdictions, hence understanding of the general principles elucidated by courts of different jurisdiction will extend us new grounds for understanding the complexities of issues arising between taxpayer and tax department.
This article is dealing with the battle over the salse taxes over beer in Israel. It was recently reported that the Minister of Finance raised the sales tax rate on beer from NIS 2.18 per liter to NIS 4.19 per liter and in light of this, local producers of beer claim that they will not be able to withstand such a tax raise.
The basic laws governing taxation are covered by the Tax Code of the Russian Federation (TC RF). The Tax Code consists of two parts. The first part of the Tax Code came into effect on January 1, 1999. It contains the basic rules that are applicable to tax legislation in Russia, including the concepts used in the tax law, the principles of taxation, the system of taxation, the status of taxpayers and government bodies involved in taxation...
levy that is imposed on gifts that you give to others if they exceed a certain amount. Every year you can give as much as $13,000 to any number of gift recipients free of the gift tax. The total sum of these tax-free gifts can equal any amount of money.
Some of the objectives of the proposed Income Tax (Transfer pricing) Regulations, 2012 as published by the Federal Inland Revenue Service in pursuance of the powers conferred on it by Section 61 of the Federal Inland Revenue Service (Establishment) Act include the provision to the Nigerian tax authorities, tools to fight tax evasion, which is usually promoted through over or under–pricing of transactions between associated enterprises not adhering to the arm’s length tax principle.
Germany - Income Tax For Year Of Death Of The Deceased Deductible According To Federal Court Of Finance
The verdict of the German Federal Finance Court (BFH) of the 04.07.2012 (AZ: II R 15/11) strongly portrayed the point in which the income tax debtfor the death year of the departed is actually tax deductible. Consequently, going forward, the debts belonging to the deceased, consisting of church taxes, as well as, the solidarity surcharges, can be subtracted before computation of the inheritance tax by the taxation office.
You may have heard the term "unified exclusion" if you have started to do any research into the field of estate planning as you look ahead toward your own future. What this is referring to is the amount of resources you can pass along to your loved ones without facing the prospect of paying a hefty tax.
In October 2012, the Maltese Government has issued a special tax status for retirees from EU, EEA countries and Switzerland when remitting their pension into Malta. A fixed tax rate of 15% will be due on the pension remitted, and the minimum tax payable shall be of €7,500 for the beneficiary and €500 for every dependant (if any).
The taxes that are imposed on transfers of assets are something to take very seriously when you are interested in wealth preservation. These taxes extend beyond the estate tax alone. There is also a gift tax, and it is unified with the estate tax under Internal Revenue Service regulations.
There are lots and lots of offer in compromise companies advertising to get your money and in return have you pay “pennies on the dollar” to resolve your tax liability. This post reviews the real facts underlying how the offer in compromise process really works. First we’ll take a look at getting your offer in compromise based on economic hardship. We’ll examine just what this means in the offer in compromise arena.
It is important to be aggressive about tax planning in light of the heavy toll that the federal estate tax can take on your legacy. To be able to act intelligently you must gain an understanding of the taxation that is imposed on significant asset transfers and we will shed some light here.
To be able to proceed intelligently when you are planning your estate you must have an understanding of the relevant tax laws. There are those who think that it is not fair, but acts of giving while you are alive or after you pass away are taxable.
Success is the name of the game, but unfortunately the fruition of your financial goals can present some tax challenges. If your assets exceed a certain amount after you pass away your heirs are potentially subject to the Federal estate tax.
Withholding Tax is a mandatory advance tax payment which is deducted and withheld from any income or disbursement due to a taxable person, for onward remittance to the relevant tax or government collecting authority, against a final tax liability. This advance tax payment can be set-off against the final tax obligation(s) of the taxable person subject to such person applying for and obtaining the Withholding Tax Credit Notes in respect of each advance tax withheld and remitted.
A study was released earlier this year by the American Journal of Medicine regarding bankruptcies caused by medical bills that were simply too overwhelming to address. They found that in 2007 62% of all bankruptcies were due to an inability to pay health care debt. If you are in a position to assist family members who may be in financial difficulty due to medical bills you may be concerned about the gift tax.
Leaving behind your final wishes via the construction of a Last Will is part of the equation when you are making preparations for the inevitable. But words on a piece of paper are not going to accomplish much in and of themselves. Someone is going to have to actually make sure that your wishes are carried out,and this will be the executor or personal representative.
As they say time flies,and it is kind of hard to believe that we are so far into 2012 already. This is a very interesting year on a number of different levels and coming changes to the tax code are among the points of intrigue. You may remember that the Bush era tax cuts were scheduled to expire at the end of 2010.
The Federal estate tax is unified with the gift tax.As a result,gifts that you give are subject to the same 35% tax that is applied to your estate. It should be noted that there is a unified gift/estate tax exemption and right now it sits at $5.12 million. However, these numbers are only accurate for 2012.As laws currently stand,the exclusion is going to be reduced to $1 million in 2013 and the rate is scheduled to rise to 55%.
There was once a time when being a millionaire implied that you were truly of the upper crust.The commonly held wisdom was that a millionaire could live forever on the interest alone and that million dollar figure took on a magical allure. Nowadays things are quite a bit different and everyday people who work hard and do the right things could find themselves with assets exceeding $1 million.
Individuals who are receiving Social Security did not receive any cost-of-living adjustments in 2009 or 2010. These adjustments are given based on the rate of inflation,and during those years increases were not justified based on the parameters that are used. Unfortunately, the health care costs that seniors must pay out-of-pocket rose during that time by just over 14%, and this underscores how difficult is to get by if you are overly reliant on Social Security.
Once you come to the realization that your store of financial assets exceeds the unified estate/gift tax exclusion amount you have a pleasant problem on your hands. You have to seek ways to gain tax efficiency,and one possibility would be to give certain types of gifts to family members or others that you care about.
Mary Smith contacted me to assist her in the sale of a vacant lot owned by both Mary and her son, Michael. Mary originally went to a local title agency and was advised that she cannot complete the sale because her son is a minor – i.e., under the age of 18 years. Mary owns a 50% interest in the property, and her 17 year old son, Michael, owns the remaining 50% interest. They have a Buyer ready to purchase the lot for $25,000.00.
A non-wage levy seizes the taxpayer’s right, title and interest to all property that is in the possession of the levied party (the person or company holding your property for you) at the time the levy is served. It seizes no more and no less. The exemptions from levy are few and meager, but they exist and consist of the first (sometimes the last) line of defense against the levy.
The wise taxpayer will always ask his or her tax lawyer or tax audit representative in cases like tax audit cases first about the statute of limitations in the case. At its simplest, a statute of limitations is just what it says–a limit on the amount of time the IRS has to perform a particular task, like audit taxes or collect taxes. And, it is set by statute, hence “statute of limitations.”
Wage levies are vicious collection devices used by the IRS to get your attention. A wage garnishment can take up to 85% of your gross pay, leaving you with nowhere to sleep but the street. In most cases our immediate goal is to remove the levy. In the case of a wage levy, Revenue Officers or ACS often (but not always) release wage levies upon request of an authorized representative.
July 25th, 2012. - On July 25th, 2012, the State Council of China held its standing meeting and approved to extend the Value Added Tax (“VAT”) reform. From August 1st to December 31st, 2012, the transformation from Business Tax (“BT”) to VAT in transportation industries and certain modern service industries will be launched in 8 provinces and 2 cities as follows:
Taxes are a controversial subject, but most people would probably agree that a tax that takes more of the assets in question than it leaves behind to the rightful owners is questionable. However, this is the situation those in the estate planning community are faced with in 2013 with regard to the federal estate tax.
Some people within the estate planning community call the estate tax the "death tax" because it is a tax that is levied because you passed away and for no other reason. The assets that comprise your estate are simply your real and personal property you accumulate while you are living.You paid taxes along the way and these assets are what you were able to hold onto after paying them. They are not taxed again while you are alive.
Where do you draw the line when it comes to a tax rate? This is an ongoing question that is always being debated among lawmakers. However, even the most zealous pro-tax advocates may have to concede that a tax that consumes the majority of the resources in question is a bit excessive. This will be the case with the federal estate tax in 2013, assuming the laws that are in place as of this writing remain in effect.
The forces of ‘globalization’ have had a profound impact on the world’s leading economies. Today, the leading countries of Asia know this lesson well, and North America and Europe are rapidly feeling the effects of the difficulties faced by Asian economies.
Business sale and purchase of property has been demanded by many people. In performing the business sale and purchase of property, it does not only need an agreement between seller and buyer, but there are things that shall be performed by both parties as one of the obligations to State. The relevant obligation is payment of a tax in acquisition of property that should be performed by buyer and seller.
Further to the suspension of the Permanent Residents Scheme in December 2010, the Government of Malta has put in place a scheme for special tax status aimed at attracting internationally mobile, high net worth individuals to become tax resident in our islands and benefit from a favourable tax rate of 15% on any income remitted into Malta.
The general perception that dormant companies are not liable to pay any tax at all as they are not engaged in any trade or business is not correct. As a tax-avoidance measure, Minimum Tax is charged on the higher amounts of such a dormant company’s gross profit, or its net assets, or its paid-up share capital, or its turnover, at the rates stated in this article. The only exemptions to this rule are as also stated in this article.
When this year comes to a close we are going to be looking at an entirely different lay of the land when it comes to the estate tax parameters. With this in mind we would like to examine the subject of estate tax exclusion portability. What does portability mean in this context?
The federal estate tax is applicable to everyone as an individual, so each person is afforded an individual exemption. The current amount of the estate tax exclusion is $5.12 million. So, a husband and wife would each have $5.12 million for a total of $10.24 million that could be passed along to their heirs before the estate tax becomes applicable.
It is common on the market that any business structuring for a Ukrainian business is conducted mostly by financial advisers and business consultants looking primarilyat the cost reduction and direct tax economy. However, current tax legislation in most countries around the world is eager to fight with structures erected only for tax economy purposes. Ukrainian tax authorities are not exception in this case.
Malta has come a long way since it first gained its Qualifying Recognized Overseas Pension Schemes (“QROPS”) status from the UK HM Revenue and Customs (“HMRC”) in 2009. Since then Malta has rapidly established a reputation as a safe and robust QROPS domicile. As will be seen below, various factors have proved pivotal in allowing Malta to benefit from a steadily growing slice of the QROPS market.
Malta’s double taxation agreement (DTA) with Switzerland has entered into force on the 6th July 2012. This DTA was signed on the 25th February 2011 and replaces the agreement signed on the 18th December 2008 which used to be limited to the taxation of income derived from ships and aircraft.
Turkish Parliament has adopted a new law, Law No 6322 that brings out a limitation to financial expenses to corporate and income taxpayers. Accordingly, amounts including but not limited to credit interest, foreign exchange losses i.e. as a part of financial charges that exceed the equity capital and not a part of investment expenses shall not be determined as financial expenses and be written off as of 01 January 2013.