double taxation


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Double taxation

Government taxation of the same money twice; specifically, earnings taxed first at the corporate level and then again as dividends at the stockholder level.

Double Taxation

A situation in which the same earnings are taxed twice. One of the most common examples of double taxation occurs when a publicly-traded company pays corporate taxes on its earnings. It then passes on some of those earnings to shareholders as dividends, on which they must pay individual income tax or capital gains tax. Various means exist to reduce double taxation. See also: Tax avoidance.

double taxation

Taxation of the same income twice by the same taxing authority. It is generally used to refer to the taxation of dividends that are taxed once at the corporate level (as income before dividends are declared) and again at the personal level (when the dividends are received).

double taxation

the TAXATION of INCOMES and PROFITS in both the country where they arise, and again where these incomes and profits are remitted to the income earner's home country. Such double taxation can be a significant deterrent to international labour and capital movements. For this reason many countries have negotiated double taxation agreements which limit taxation liability to the country in which the income is earned. Compare UNITARY TAXATION, WITHHOLDING TAX.

double taxation

the TAXATION OF INCOMES and PROFITS, first in the country where they arise and again when these incomes and profits are remitted to the income earner's home country. Such double taxation can be a significant deterrent to international labour and capital movements. For this reason,

many countries have negotiated double taxation agreements, which limit taxation liability to the country in which the income is earned. See UNITARY TAXATION, MIXER COMPANY.

double taxation

A situation said to exist when a corporation must pay taxes on income, make dividend payments to shareholders on after-tax dollars, and then the shareholders must again pay taxes on the dividends. This is the situation with normal corporations, called C-corporations, that do not qualify for S-corporation (small corporation) status. S-corporations file reports allocating pro rata shares of all income to the individual shareholders, who then pay taxes on that number. The corporation itself does not pay any taxes.

References in periodicals archive ?
The two contracting parties to the private double taxation agreement are
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The second round of double taxation negotiations between the Finance Ministries of the Kyrgyz Republic and the Republic of Korea took place in Seoul on November 17-20, press service of the Kyrgyz Finance Ministry said.
Dividends paid by USCO would be included in computing Cauco's income under section 90, but double taxation would be relieved through an equivalent deduction under paragraph 113(1)(a).
A shareholder who is not a Massachusetts resident might face state double taxation of income and might have to report S income to his or her home state and to Massachusetts.
Payment of the required dividend is subject to double taxation.
The proposed elimination of double taxation on dividends marks a major change on Wall Street, and market expert John Bollinger likes what he sees.
The Belarus government yesterday announced that it has ratified an agreement with Sri Lanka to avoid double taxation on income.
Summary: ABU DHABI - The UAE and the Republic of Montenegro on Monday signed two agreements on double taxation avoidance and on protection of investments.
ANKARA, Apr 21, 2009 (TUR) -- Turkish and Finnish finance ministers agreed on Tuesday to renew a deal to prevent double taxation in trade between the two countries.
International double taxation represents the imposition of comparable income taxes by two or more sovereign countries on the same income items on the same taxpayer for the same tax period.
treaty partners devote more resources to double taxation issues (particularly in the transfer pricing and permanent establishment areas), the Competent Authority process has gained in importance.