Double taxation treaty

Double taxation treaty
An agreement between two countries intended to limit the double taxation of income and gains, under the terms of which an investor which is tax resident in one country but invests in another may be able to apply for an exemption or reduction in the taxes imposed on his income or gains by the country of his investment, on the basis that such income or gains will have tax levied on them in the country in which he is tax resident. This type of treaty encourages trade and financial transactions between countries.

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