Expand Internationally
Lovetts can help you to expand your Australian business overseas. The default position with international taxation arrangements is that you pay double taxation, here and abroad, unless careful structuring is undertaken.
We can help you take on an overseas employment position by offering planning guidance to optimise your tax residency circumstances so you do not pay unnecessary double taxation. Your departure, return, living and family arrangements whilst away can be critically important to your Australian tax outcomes. We understand your objectives and provide clear advice and assistance with necessary record keeping for complete financial peace of mind.
Tax Residency
Broadly, there are four categories of tax systems around the world:
- Residency based – Australia, UK, New Zealand and
most Commonwealth nation - Citizenship based – USA
- Territory based – Singapore, Hong Kong, Malaysia, etc.
- No income tax – Middle east countries and some tax havens
Where an individual (or accompanying) undertakes activities internationally, under our system, the first question is about the location of the taxpayer’s residency. For an individual, that question revolves around the location of your home, work, family, social arrangements and investments. For a company, it’s all about central management and control or the “effective place of management”. Either way, it’s a critical question.
Foreign country tax rules and contacts
It’s important to have a satisfactory understanding of the tax rules in other countries. A lot can be determined by looking up legislation on the internet, but Lovetts can help you with their network of tax specialist contacts in overseas jurisdictions to confirm key issues.
Double taxation agreements
There is a network of bilateral treaties where two countries agree tax rules to tie-break tax residency and taxation rights. They form a third “spoke to the wheel” of determining international tax consequences.
International business structures
Where business structures are involved, rate care is required because the default position is double tax! It’s important to take account of the business stakeholders’ long-term objectives for the business, capital requirements, availability of flow-through or corporate tax vehicles, international tax rules, Australian tax rules, tax treaty rules in gaining the right balance between asset protection, flexibility, simplicity and succession planning.