Notícias do mercado de ações de hoje Análise do amplificador Tempo real após as horas Notícias do pré-mercado Resumo das citações do flash Gráficos interativos Configuração padrão Observe que, uma vez que você fizer sua seleção, ela se aplicará a todas as futuras visitas ao NASDAQ. Se, a qualquer momento, você estiver interessado em reverter as nossas configurações padrão, selecione Configuração padrão acima. Se você tiver dúvidas ou encontrar quaisquer problemas na alteração das configurações padrão, envie um email para isfeedbacknasdaq. Confirme a sua seleção: Você selecionou para alterar sua configuração padrão para a Pesquisa de orçamento. Esta será a sua página de destino padrão, a menos que você altere sua configuração novamente ou exclua seus cookies. Tem certeza de que deseja alterar suas configurações. Temos um favor a pedir. Desative seu bloqueador de anúncios (ou atualize suas configurações para garantir que o javascript e os cookies estejam habilitados), para que possamos continuar fornecendo as notícias de mercado de primeira linha E dados que você espera de nós. Centro de Política Tributária e Administração Glossário de Termos Fiscais Disclaimer: Explicações sobre os termos são muito condensadas e podem não estar completas.160 Não são consideradas necessariamente refletir a posição oficial da OCDE na interpretação internacional Termos fiscais, por exemplo, no contexto do tratado tributário. ABATAMENTO - Uma redução na avaliação de impostos, penalidades ou juros quando se determina que a avaliação está incorreta ABUSO DE LEI - A doutrina que permite às autoridades fiscais ignorar um formulário de direito civil usado pelo contribuinte que não possui base comercial ACELERADO DEPRECIAÇÃO - Método de depreciação segundo o qual os contribuintes podem atribuir maiores deduções de depreciação ao primeiro ano ou aos primeiros anos de ativos comerciais úteis, como planta e maquinaria BASE COMPTAÁVEL160 - Método de cálculo dos valores sujeitos a imposto de renda e IVA. Em relação ao IVA, o imposto seria calculado como uma taxa percentual sobre o excesso de vendas ao longo das compras. Este é um conceito teórico e nenhum país o usa. PERÍODO CONTABILÍSTICO160 - Período de tempo utilizado pelo contribuinte para a determinação do passivo tributário CONTABILIDADE PAGA160 - Uma lista das dívidas atualmente de uma pessoa ou empresa, principalmente para a compra de serviços, inventário e suprimentos CONTAS RECEIVAS160 - A Lista do dinheiro devido em conta corrente a um credor, que é mantido no curso normal do negócio de credores e representa reclamações e transações não liquidadas CONTABILIDADE RECORDS160-- Todos os documentos e livros utilizados na elaboração da declaração de imposto e todas as demonstrações financeiras, Incluindo o razão geral, controlos subsidiários, boletos de vendas e faturas. BASE BÁSICA (MÉTODO ACRUÍDO) 160 - Método contábil pelo qual os itens de receita e despesa estão incluídos na receita ou despesa tributável à medida que são ganhos ou incorridos, em vez de serem recebidos ou pagos AD VALOREM TAX - A imposto sobre bens ou bens Expresso em percentagem do preço de venda ou valor avaliado COMPANHIA ADMINISTRATIVA 160 - Ver: Companhia de serviços ADMINISTRATIVOS DESPESAS160 - Despesas que não são tão facilmente associadas a uma função específica como os custos diretos de fabricação e venda. Geralmente inclui despesas do escritório da sede e despesas contábeis. SERVIÇO ADMINISTRATIVO160 - Escritório freqüentemente localizado em um país diferente do da sede, da empresa-mãe ou do país de atuação. ARRANQUE DE PREÇO AVANÇADO (APA) 160 - Um acordo que determina, antes das transações controladas, um conjunto apropriado de critérios (por exemplo, método, comparáveis e ajustes adequados, pressupostos críticos sobre eventos futuros) para a determinação do preço de transferência para Essas transacções durante um período de tempo fixo.160 Um acordo de preços antecipados pode ser unilateral envolvendo uma administração tributária e um contribuinte ou multilateral envolvendo o acordo de duas ou mais administrações fiscais. ADVANCE RULING160 - Uma decisão de carta, que é uma declaração escrita, emitida a um contribuinte pelas autoridades fiscais, que interpreta e aplica a lei tributária a um conjunto específico de fatos. SOCIEDADES AFILIADAS160 - Termo geral usado para descrever a relação entre dois ou mais Empresas ligadas por um interesse comum PRIVILÉGIO DE AFILIAÇÃO160 - Isenção fiscal ou isenção concedida às distribuições de dividendos feitas por uma subsidiária residente à sua controladora que detém uma certa porcentagem mínima de ações, a fim de mitigar a dupla tributação desses dividendos. AGÊNCIA160 - Um negócio que fornece um serviço específico para uma empresa (que está fora do país onde a agência está localizada). A agência dependente constitui um estabelecimento permanente para a outra empresa e os rendimentos obtidos através da agência são tributados sobre o rendimento obtido do país onde a agência está localizada, enquanto a agência independente não. AGREGAÇÃO160 - Termo utilizado para denotar a adição da renda dos contribuintes de todas as fontes, a fim de determinar a taxa de imposto aplicável para fins de imposto de renda. ALIEN, TAX TRATAMENTO DE160 - Uma pessoa que não é cidadão do país em que ele ou ela vive. Em geral, a maioria dos países não faz distinção entre nacionais e estrangeiros para fins fiscais, e a responsabilidade fiscal é baseada na residência e no domicílio. ALIENAÇÃO DO INGRESO160 - Termo geralmente utilizado para descrever a transferência do direito de receber renda de uma fonte, sem transferir a propriedade dessa fonte para a mesma pessoa. ALLOCATION160 - A repartição ou cessão de receita ou despesa para vários fins tributários, e. Entre estabelecimentos permanentes em várias jurisdições ALLOWANCE160 - Dedução ou isenções geralmente feitas no cálculo de imposto de renda, taxas de herança e presente e algumas formas de impostos sobre vendas. AMORTIZATION160 - Processo de cancelar o custo de um ativo intangível durante sua vida útil. MÉTODO DE AMORTIZAÇÃO160 - Método de cálculo de um crédito ao abrigo de um regime de IVA em que são adquiridos bens de investimento que tenham uma vida útil no negócio por um período superior a um ano. O imposto incorporado no preço pago pelos ativos pode ser creditado ao comerciante durante um período de anos correspondente à vida útil dos ativos. APA160 - Ver: Arranjo de preços antecipado MÉTODO DE APROVAÇÃO160 - Um dos métodos utilizados para alocar renda e despesas entre empresas relacionadas usando uma fórmula consistiu em alguns fatores, como vendas, propriedades ou folha de pagamento. ARBITRAGE160 - Processo de compra de uma mercadoria (que pode incluir moeda ou títulos) e simultaneamente vendê-lo em outro mercado, a fim de lucrar com os diferenciais de preços. ARBITRAGE, TAX160 - Processo de entrada em uma transação motivada por impostos (ou seja, obter lucro com a aplicação das regras fiscais). ARBITRAÇÃO160 - Termo utilizado para a determinação de uma disputa pelo julgamento de uma ou mais pessoas, chamadas árbitros, que são escolhidas pelas partes e que normalmente não pertencem a um tribunal normal de jurisdição competente ARMÉDIA LENGTH PRINCIPE 160 - O internacional Padrão que afirma que, quando as condições entre as empresas relacionadas são diferentes das empresas independentes, os lucros acumulados em razão dessas condições podem ser incluídos nos lucros dessa empresa e tributados em conformidade ARMS LENGTH RANGE160 - Um termo usado no preço de transferência Para descrever uma gama de valores que podem ser definidos para selecionar um preço adequado de comprimento de braços de transações comparáveis. TRANSACÇÃO DE LARGEM DE ARMAS - Uma transação entre as partes, cada uma das quais age em seu próprio interesse. AVALIAÇÃO160 - Ato de cálculo do imposto devido EMPRESAS ASSOCIADAS160 - De um modo geral, as empresas estão associadas onde as mesmas pessoas participam de forma direta ou independente na gestão, controle ou capital de ambas as empresas, ou seja, ambas as empresas estão sob controle comum. REGRAS DE ATRIBUIÇÃO160 - Regras que criam propriedade atribuindo ações a uma única parte, mesmo que as ações sejam de propriedade legal de outra parte, muitas vezes chamada de propriedade construtiva de estoque. AUDIT160 - Exame e verificação realizada por uma agência externa (como uma empresa de contabilidade ou as autoridades fiscais) de livros e contadores de um contribuinte8217 e a precisão geral de devoluções e declarações, seja como uma operação de rotina ou em caso de evasão. ATIVIDADES AUXILIARES160 - Um local de trabalho fixo através do qual uma empresa exerce unicamente uma atividade que tem, para a empresa, um caráter preparatório ou auxiliar, é, de acordo com os tratados tributários em geral, considerado não ser um estabelecimento estável. O critério decisivo é se a atividade do local fixo de negócios em si constitui uma parte essencial e significativa da atividade da empresa como um todo. AUXILIARY COMPANY160 - Empresa que faz parte de um grupo de empresas e que presta serviços auxiliares a empresas do grupo. AVOIDANCE160 - Um termo que é difícil de definir, mas que geralmente é usado para descrever o arranjo de assuntos de contribuintes destinados a reduzir sua responsabilidade tributária e que, embora o arranjo possa ser estritamente legal geralmente está em contradição com a intenção do Lei que pretende seguir. Cf. Evasão EMPRÉSTIMO BACK-TO-BACK - Método de empréstimo entre partes relacionadas onde um empréstimo é canalizado através de um intermediário externo independente. BAD DEBT160 - Dívida que é improvável que seja paga. As dívidas incobráveis geralmente podem ser tratadas como perdas e baixadas contra uma reserva para tais dívidas. BALANÇO160 - Demonstração da posição financeira de uma empresa a partir de uma determinada data. A declaração mostrará os ativos de negócios em uma coluna e seu passivo e patrimônio de proprietários em outra coluna. PAGAMENTO DE EQUILÍBRIO160 - Um pagamento, normalmente de um ou mais participantes para outro, para ajustar os participantes8217 partes proporcionadas de contribuições, que aumenta o valor das contribuições do pagador e diminui o valor das contribuições do beneficiário pelo valor do pagamento , No contexto da CCA (Cobrança de custos). DISPOSIÇÕES DE SEGURANÇA BANCÁRIA160 - Disposições que exigem que um banco se recuse a divulgar informações sobre seus clientes a terceiros, incluindo as autoridades fiscais. BAPA160 - Acordo de preços antecipados bilaterais. Também chamado MAP APA. BASE COMPANY160 - Empresa situada em um país com impostos baixos ou não tributários (ou seja, paraíso fiscal), que é usado para proteger renda e reduzir impostos no país de origem dos contribuintes. As empresas de base realizam certas atividades em nome de empresas relacionadas em países de alta tributação (por exemplo, serviços de gerenciamento) ou são usadas para canalizar determinados rendimentos, como dividendos, juros, royalties e taxas. BASE COST160 - Termo utilizado na legislação tributária de ganhos de capital para designar o custo de um ativo para um proprietário. BEARER SECURITIES160 - Ações, títulos, etc., em que a propriedade pode ser transferida de um detentor para outro sem registro da transação pela empresa emissora, ou seja, o título passa com a entrega. BENEFICIAL OWNER160 - Uma pessoa que goza dos benefícios reais da propriedade, mesmo que o título da propriedade esteja em outro nome. Muitas vezes importante nos tratados fiscais, como residente de um parceiro do tratado tributário, podem ser negados os benefícios de certas taxas reduzidas de imposto retido na fonte se o beneficiário efetivo dos dividendos, etc., for residente de um país terceiro. BENEFICIÁRIO160 - A pessoa que recebe ou recebe os benefícios resultantes de certos atos. Em um contexto fiscal, o beneficiário é a pessoa com direito a benefícios de propriedade de confiança ou de uma apólice de seguro. BENEFÍCIOS EM KIND160 - Prazo que se refere a ganhos, geralmente de emprego, que não sejam em dinheiro, como parte da remuneração por serviços prestados. TESTE DE BENEFÍCIOS160 - Ao considerar se uma empresa pode ser autorizada a deduzir, como despesa, os pagamentos efetuados a uma empresa relacionada em um grupo multinacional por conta de despesas incorridas por essa empresa relacionada na prestação de serviços intragrupo, as autoridades fiscais rejeitariam uma Dedução a menos que um benefício real tenha sido conferido à empresa que reivindica a dedução. BERRY RATIO160 - Razão utilizada para estabelecer um lucro de comprimento de braços. O índice Berry é a proporção de uma receita bruta do negócio para os custos operacionais. MELHOR MÉTODO REGRA160 - Regra de preços de transferência exigindo que um contribuinte use o método de preços de transferência que resulte na medida mais confiável de um preço de comprimento de braços. Esta regra não prescreve prioridades entre vários métodos. ARQUIVO DE PREÇO AVANÇADO BILATERAL160 (BAPA) 160APA - envolvendo duas ou mais autoridades fiscais BOND160 - Obrigações de dívida com juros a um governo ou empreendedor. A taxa de juros geralmente é corrigida. VALOR DO LIVRO160 - O valor do ativo individual, conforme registrado nos registros contábeis de um contribuinte, calculado como custo real menos provisões para qualquer depreciação BRACKETS160 - Termo usado em conexão com o sistema de tributação graduado para se referir, por exemplo, às lajes ou Fatias de renda tributável sujeitas a taxas específicas de imposto de renda. BRANCH160 - Divisão, escritório ou outra unidade de negócio localizada em um local diferente do escritório principal ou da sede. Não é uma entidade jurídica separada. IMPOSTO DE RENDA DE RENDIMENTOS (BPT) 160 - Ver: Imposto de sucursal BRANCH TAX160 - Imposto sobre sucursais de empresas estrangeiras, além do imposto de renda corporativo normal sobre a receita das agências. Isto é equivalente ao imposto sobre dividendos que seria devido se a sucursal tivesse sido uma subsidiária (ver: companhia subsidiária) da empresa estrangeira e tivesse distribuído seu lucro como dividendos. BROTHER-SISTER CORPORATIONS160 - Duas ou mais empresas detidas e controladas pelos mesmos acionistas. BURDEN OF PROOF160 - Obrigação de persuadir um tribunal ou outra entidade da validade de uma afirmação factual. EMPRESAS DE NEGÓCIO160 - Ativos utilizados para o exercício de uma empresa TESTE DE PROPÓSITO DE NEGÓCIOS160-- Teste usado como arma contra esquemas de evasão fiscal. Os esquemas artificiais que criam circunstâncias sob as quais nenhum imposto ou imposto mínimo é cobrado podem ser desconsiderados se eles não atendem a uma finalidade comercial. PAGAMENTO DE COMPRA160 - Um pagamento efetuado por um novo participante em um CCA (Arranjos de Contribuição de Custos) já ativos para obtenção de interesse em qualquer resultado da atividade CCA anterior. PAGAMENTO DE COMPRA 160 - Compensação de que um participante que se retira de uma CCA já ativa pode receber dos demais participantes para uma transferência efetiva de seus interesses nos resultados das atividades CCA passadas. CAPITAL ATIVO160 - Todos os bens detidos para investimento por um contribuinte. OPÇÃO DE CHAMADA160 - Contrato segundo o qual o titular da opção tem o direito, mas não a obrigação de comprar valores mobiliários ou mercadorias em ou antes de uma data especificada para um preço de exercício especificado. DESPESAS DE CAPITAL160 - Despesas de melhoria em vez de reparar. Onde as despesas estão mais intimamente ligadas à estrutura de ganhos de renda do que a sua capacidade de obtenção de renda, é uma despesa de capital.160 CAPITAL GAIN160 - Um ganho na venda de ativos de capital. CAPITAL TAX160 - Um imposto com base em participações de capital, em oposição a um imposto sobre ganhos de capital. CAPITALIZE160 - Para registrar os desembolsos de capital como adições às contas de ativos, não como despesas. PERDA DE CAPITAL160-- A perda da venda de um bem de capital. CAPTIVE BANK160 - subsidiária integral de um grupo multinacional de empresas cujo objetivo é fornecer serviços bancários ao grupo e aqueles com quem o grupo negocia. Um banco cativo geralmente está localizado em um paraíso fiscal, a fim de aproveitar os requisitos de capital baixos e a liberdade de controle de câmbio. COMPANHIA DE SEGUROS CAPTIVOS160 - subsidiária integral de um grupo multinacional de empresas que assegura ou reúne exclusivamente os riscos das empresas que pertencem ao grupo. Uma companhia de seguros cativa geralmente está estabelecida em um país de baixa tributação. Se os prémios pagos às companhias de seguros cativas são reconhecidos como despesas comerciais, depende do país em questão. CARRYBACK160-- Ver: Carryover CARRYFORWARD160-- Ver: Carryover CARRYOVER160 - Um processo pelo qual as deduções ou créditos de um ano tributável que não pode ser usado para reduzir a responsabilidade tributária nesse ano são aplicados contra um passivo tributário nos exercícios subsequentes (carryforward) Ou anos anteriores (carryback). BASE DE EFECTIVO (MÉTODO DE CAIXA) 160 - O método contábil que reconhece renda e deduções quando o dinheiro é recebido ou pago. CCA160 - Veja: Arranjos de Contribuição de Custo GERENCIAMENTO CENTRAL E CONTROLE160-- Onde a gestão e o controle central estão localizados é um teste para estabelecer o local de residência de uma empresa. Em termos gerais, refere-se ao mais alto nível de controle do negócio de uma empresa. CENTRO DE VITAL INTEREST160-- Este é um dos critérios utilizados para resolver o problema da dupla residência de indivíduos. Refere-se ao local onde as relações pessoais e econômicas dos contribuintes estão mais próximas. CFC160 - Veja a empresa estrangeira controlada CHERRY PICKING 160 - Termo usado nos EUA em arranjos RampD para impedir que uma parte contratante selecionasse ou financie apenas as tecnologias que foram desenvolvidas com sucesso, ou seja, a escolha da cereja. No contexto do preço de transferência, muitas vezes descreve uma situação em que uma autoridade fiscal tenta impor um ajuste de TP em um contribuinte com base em algumas das transações com partes relacionadas de outras empresas comparáveis, com a intenção de maximizar seu ajuste. CIF VALUE160-- O valor dos bens importados que inclui custo, seguro e frete. LEI CIVIL160 - Sistemas de direito baseados principalmente em estatutos ou códigos em vez de decisões judiciais. Exemplos são os sistemas francês e alemão. CLOSE (CLOSELY HELD) COMPANY160-- Empresa detida ou controlada por um único acionista ou grupo de acionistas estreitamente vinculado. COMUNICADO COM PADRÃO DE RENDA160 - Veja: Provisão de royalties provisórios INTANGIBLE160 COMERCIAL - Um intangível que é usado em atividades comerciais, como a produção de um bem ou a prestação de um serviço, bem como um direito intangível que é ele próprio um ativo comercial transferido Aos clientes ou utilizados na operação dos negócios. COMMODITIES FUTURES160-- Contratos, negociados em mercados de futuros reconhecidos, nos quais os vendedores prometem entregar uma determinada mercadoria em uma determinada data a um preço predeterminado. TAX160 - imposto com base em um número seletivo de commodities. LEI COMUM160 - O corpo de leis desenvolvido pelo sistema judiciário em sistemas baseados no direito inglês e que é seguido pela doutrina do precedente, ou seja, decisões judiciais passadas em casos semelhantes. Grande parte disso está incorporada no estatuto.160 Também este termo é usado para descrever um sistema que, em última instância, é baseado em sistemas jurídicos ingleses, em oposição aos sistemas de direito civil. STOCK COMUM160 - O estoque ordinário de uma corporação. Uma participação acionária ou de participação em uma empresa. O detentor de ações ordinárias geralmente tem voto na decisão de assuntos da empresa. O estoque comum geralmente é o último em prioridade quando os lucros ou ativos são distribuídos. COMPANHIA160 - Muitas vezes, significa uma entidade jurídica separada (uma corporação) organizada para realizar uma atividade, empresa ou empresa industrial.160 Às vezes, ele tem um significado mais amplo para significar empresas individuais ou coletivas que buscam lucro. ANÁLISE DE COMPARABILIDAD160 - Comparação de condições de transações controladas com condições prevalecentes em transações entre empresas independentes (transações não controladas). As transações controladas e não controladas são comparáveis se nenhuma das diferenças entre as transações pudesse afetar materialmente o fator que está sendo examinado na metodologia (por exemplo, preço ou margem), ou se houver ajustes razoavelmente precisos para eliminar os efeitos materiais de tais diferenças. MÉTODO DE LUCRO COMPARTIL (CPM) 160 - De acordo com os regulamentos dos EUA, o CPM é um método para determinar uma consideração de comprimento de armas para transferências de propriedade intangível. Se a receita operacional reportada da parte testada não estiver dentro de um determinado intervalo, será feito um ajuste. Com efeito, este método requer uma comparação do lucro operacional resultante da contraprestação efetivamente cobrada em uma transferência controlada com o lucro operacional de contribuintes similares que não estão controlados. Método de preço de transferência COMPARÁVEL (CUP) 160-- Um método de preços de transferência que compara o preço de propriedade ou serviços transferidos em uma transação controlada para o preço cobrado por propriedade ou serviços transferidos em uma transação não controlada comparável em circunstâncias comparáveis. MÉTODO COMPARÁVEL DE TRANSACÇÃO NÃO TRANSFORMADA (CUT )160 - Uma metodologia de preços de transferência utilizada nos EUA, que determina uma taxa de royalties de comprimento de armas para um intangível por referência a transferências descontroladas de propriedades intangíveis comparáveis em circunstâncias comparáveis. AJUSTAMENTO DE COMPENSAÇÃO160-- Um ajuste no qual o contribuinte relata um preço de transferência para fins tributários, que é, na opinião dos contribuintes, um preço de comprimento de armas para uma transação controlada, mesmo que esse preço seja diferente do valor efetivamente cobrado entre as empresas associadas. Este ajuste será feito antes da declaração de imposto ser arquivada. COMPENSAÇÃO160 - Recompensas monetárias e não monetárias diretas e indiretas aos funcionários. OPÇÕES DE ACÇÕES COMPENSATÓRIAS160-- Opções oferecidas aos empregados como compensação parcial por seus serviços. AUTORIDADE COMPETENTE (CA) 160 - Fórum para resolver litígios decorrentes da aplicação e / ou interpretação de um tratado de dupla tributação. Ambos os países tratados designam um representante (freqüentemente o Ministério das Finanças ou seu representante autorizado) como a CA para ajudar os contribuintes prejudicados, atuando como a ligação oficial com a CA estrangeira. A CA geralmente é indicada nas seções de definições de tratados fiscais. COMPLIANCE160-- Veja: Conformidade fiscal CONDUIT APROXIMAÇÃO160-- Um método pelo qual as receitas ou deduções fluem para outra pessoa CONDUIT COMPANY160-- Empresa criada em conexão com um esquema de evasão fiscal, pelo qual a renda é paga por uma empresa ao canal e depois redistribuída Por essa empresa aos seus acionistas como dividendos, juros, royalties, etc. CONSIDERAÇÃO160 - Qualquer coisa de valor, incluindo propriedade, dada em troca de uma promessa ou desempenho de outra parte para formar um contrato RETORNO DE IMPOSTO CONSOLIDADO160 - Uma declaração de imposto combinada em O nome da empresa-mãe arquivado por empresas organizadas como um grupo. CONSORTIUM160-- Associação de empresas, sejam pessoas físicas, parcerias ou empresas, operando em conjunto temporariamente para algum empreendimento específico. DIVIDENDO CONSTRUTIVO160 - Uma variedade de pagamentos, seja em dinheiro ou em espécie, feitos por empresas aos acionistas ou pessoas associadas, que não são expressos como dividendos, podem, no entanto, ser considerados pela legislação tributária como distribuições de lucros e tratados para fins fiscais como se eles Foram dividendos. PROPRIEDADE CONSTRUTIVA160-- Um contribuinte pode ser considerado propriedade própria ou estoque que ele próprio possui indiretamente. IMPOSTO DE CONSUMO160 - Imposto geralmente destinado a cair no consumo final de bens e serviços. FABRICANTE DE CONTRATO160-- Um fabricante, na maioria dos casos, localizado em uma jurisdição de baixo custo, que possui uma licença para usar uma propriedade intangível desenvolvida por sua empresa-mãe. O fabricante usa a propriedade intangível para produzir uma propriedade tangível que é então revendida aos pais para distribuição aos clientes finais. ANÁLISE DE CONTRIBUIÇÃO160 - Quando o método de divisão de lucro é aplicado em casos de preços de transferência, uma análise de contribuição exige que o lucro combinado seja dividido entre empresas associadas com base no valor relativo das funções desempenhadas por cada uma das empresas associadas que participam da transação controlada . CONTROLE 160 - A capacidade de uma pessoa para garantir que outra pessoa age de acordo com os desejos das primeiras pessoas ou o exercício dessa capacidade. O exercício de controle por parte de uma pessoa pode permitir que indivíduos e corporações evitem ou reduzam sua responsabilidade tributária. Normalmente, uma empresa é considerada como controladora de outra empresa se detém mais de 50 das últimas ações compartilhadas. No entanto, as definições variam de acordo com o país e a situação. EMPRESAS ESTRANGEIRAS CONTROLADAS (CFC) 160-- As empresas, geralmente localizadas em jurisdições de baixa tributação, que são controladas por um acionista residente.160 A legislação CFC geralmente é projetada para combater o abrigamento de lucros em empresas residentes em jurisdições de baixa ou nenhuma taxação. Uma característica essencial de tais regimes é que eles atribuem uma proporção da renda protegida em tais empresas ao acionista residente no país em questão. Geralmente, apenas certos tipos de receita são abrangidos pela legislação CFC, ou seja, renda passiva, como dividendos, juros e royalties. TRANSACÇÃO CONTROLADA 160-- Transações entre duas empresas que são empresas associadas em relação umas às outras. CONTROLE DE INTERESSES 160 - Propriedade de mais de 50 ações de uma empresa votante. SOCIEDADE COOPERATIVA 160 - Em geral, as sociedades cooperativas são fundadas para reduzir o preço de compra ou aumentar o preço de venda de certos produtos em benefício de seus membros ou para servir o interesse de seus membros de alguma outra forma, entre pequenos comerciantes, agricultores, Consumidores, etc. CENTRO DE COORDENAÇÃO 160 - Empresa cujo único objetivo é coordenar as atividades de empresas afiliadas, fazer pesquisas ou realizar atividades de apoio em benefício de tais corporações. COPYRIGHT 160 - Direito exclusivo concedido a autores e artistas para publicar, usar e explorar suas obras literárias ou artísticas. IMPOSTO DE RENDA CORPORATIVO 160 - Imposto de renda sobre o rendimento das empresas CORPORATE VEIL 160-- Como uma corporação é uma entidade jurídica separada, e os acionistas têm interesse na empresa e não em seus ativos, o véu corporativo é usado para descrever a incapacidade Olhar atrás da entidade legal e atribuir os ativos, dívidas e passivos das ações de uma empresa aos detentores, principalmente os acionistas. Os tribunais podem, por vezes, ser capazes de apresentar o véu corporativo para fazer uma atribuição à pessoa ou pessoas subjacentes. CORPORAÇÃO 160 - Em termos técnicos, significa uma entidade jurídica geralmente fretada por um governo relevante e separada e distinta das pessoas que o possuem. No entanto, agora é comumente usado como outra maneira de se referir a uma empresa. (Veja: Empresa) CORPORATION SHOPP ING 160 - Termo, às vezes, usado além de compras de tratados para denotar o uso de disposições de tratados tributários interpondo uma empresa em vez de uma forma diferente de associação para a qual o alívio de impostos não estaria disponível. AJUSTAMENTO CORRESPONDENTE 160 - Um ajuste à responsabilidade tributária da empresa associada em uma segunda jurisdição feita pela administração tributária dessa jurisdição, correspondente a um principal ajuste feito pela administração tributária em uma primeira jurisdição fiscal, de modo que a alocação de lucros Pelas duas jurisdições é consistente. CUSTO 160 - Preço de compra pago pela propriedade ou o valor da bolsa para o qual a propriedade é fornecida. ARRANQUE DE CONTRIBUIÇÃO DE CUSTOS 160 - A CCA é uma estrutura acordada entre as empresas para compartilhar os custos e riscos de desenvolver, produzir ou obter ativos, serviços ou direitos e determinar a natureza e extensão dos interesses de cada participante No resultado da atividade de desenvolver, produzir ou obter esses ativos, serviços ou direitos. FINANCIAMENTO DE CUSTOS 160 - Contribuição de uma empresa afiliada aos custos gerais de pesquisa e desenvolvimento (RampD) de outro afiliado ou membro do grupo, na proporção de seu volume de negócios ou algum outro critério CUSTO DE MERCADORIAS VENDIDAS (CPV) 160-- Um número representando o Custo de compra de matérias-primas e produção de produtos acabados. Incluem-se fatores claros, como o trabalho direto da fábrica, bem como outros que são menos claros, como custos indiretos COST-PLUS MARK-UP160 - Uma marca que é medida por referência às margens calculadas após a execução direta e Custos indiretos incorridos por um fornecedor de bens ou serviços em uma transação COST-PLUS METHOD160-- Um método de cotação de transferência usando os custos incorridos pelo fornecedor de propriedade (ou serviços) em uma transação controlada. É adicionado a este custo um custo apropriado mais uma margem de lucro, tendo em vista as funções executadas (levando em consideração os ativos utilizados e os riscos assumidos) e as condições do mercado.160 O que é alcançado após a adição do preço acrescido Para os custos acima mencionados pode ser considerado como um preço de comprimento de braços da transação controlada original. ACORDO DE COMPARTILHAMENTO DE CUSTOS160-- Ver: Contrato de contribuição de custo CPM160 - Ver: Método de lucro comparável CRÉDITO, IMPOSTO ESTRANGEIRO160 - Método para aliviar a dupla tributação internacional. Se a renda recebida do exterior estiver sujeita a imposto no país destinatário, qualquer imposto estrangeiro sobre esse rendimento pode ser creditado contra o imposto doméstico sobre esse rendimento.160 A teoria é que isto significa que os ganhos estrangeiros e domésticos de uma entidade serão, na medida do possível Seja igualmente tributado, embora geralmente o crédito permitido seja limitado ao valor do imposto doméstico, sem transferência se o imposto for maior no exterior. CRÉDITO, TAX160 - Provisão de dedução ou compensação direta contra o valor do imposto devido em oposição a uma compensação contra a receita. CRÉDITO, SUBJACENTE (INDIRETOS) TAX160-- Em relação a um dividendo, o crédito para o imposto subjacente é o crédito pelo imposto incidente sobre os lucros da empresa a partir da qual os dividendos foram pagos. Esse alívio pode ser dado sob um tratado tributário ou de acordo com disposições unilaterais. CRÉDITO, TÍTULO DE RETENÇÃO160 - Vários tipos de renda (como dividendos, juros, royalties) são tributados na fonte, exigindo que o pagador deduza o imposto e contabilize-o às autoridades fiscais (no exterior). O destinatário do contribuinte tem o direito de creditar o imposto retido na fonte em relação aos passivos fiscais definitivos determinados pela legislação tributária (doméstica) do país em que ele é residente. MÉTODO DE CRÉDITO160 - Veja: Crédito, imposto estrangeiro CREDITOR160 - Uma pessoa que estendeu o crédito e a quem o dinheiro é devido um credor MÉTODO CUP160 - Método comparável de preço não controlado ATIVO ATUAL 160-- O caixa, contas a receber, inventário e outros ativos Que provavelmente serão convertidos em dinheiro, vendidos, trocados ou gastos no curso normal dos negócios, geralmente dentro de um ano. DIREITOS ADUANEIROS160 - Impostos sobre mercadorias importadas para um país DANOS 160 - O montante recebido (exceto compensação de trabalhadores) por meio de processo judicial ou ação com base em direitos de responsabilidade civil ou de responsabilidade civil, ou através de um acordo de liquidação celebrado em lugar De tal acusação. DIREITOS DE MORTE 160 - Impostos impostos sobre a transferência de bens por causa de morte de pessoas. DEBÊNTURE 160 - Obrigações com juros que não são protegidas por qualquer propriedade específica, geralmente emitida por uma corporação ou governo para o público em geral. CAPITAL DE DÉBITO 160 - Fundos obtidos através de vários tipos de empréstimos que normalmente compreendem debêntures e obrigações com juros fixos. DUMPING DE DÍVIDA 160 - Transferir uma dívida ruim para uma empresa do grupo localizada em um país de taxa de imposto mais alta para amortizar a dívida nesse país. RELATÓRIO DE DEBATEQUIDADE 160 - Relação da dívida total de uma empresa com o capital social ordinário. Se uma dívida corporativa for desproporcionalmente elevada em comparação com o patrimônio líquido, a dívida poderá ser recarregada como patrimônio, resultando em uma desistência da dedução de juros e tributação dos fundos como dividendos. INSTRUMENTO DE DÍVIDA 160-- Uma promessa escrita para reembolsar uma dívida, como uma conta, caução, aceitação de banqueiros, nota, certificado de depósito ou papel comercial. DEBTOR160 -- A person who owes money a borrower DEDUCTION AT SOURCE160 -- See: Withholding tax DEDUCTIONS --160Deduction denotes, in an income tax context, an item which is subtracted (deducted) in arriving at, and which therefore reduces, taxable income. DEEMED INTEREST160 -- If a member of a multinational enterprise (MNE) receives an interest-free loan from an affiliated company, the tax authorities of the lenders country may readjust the lenders profits by adding an amount equal to the interest which would have been payable on the loan had it been made at arms length. DEEP DISCOUNT BOND160 -- See: Zero coupon bond DEFAULT160 -- The failure of a debtor to make timely payments of interest and principal amounts as they come due or to meet some other provision of a bond, mortgage, lease, or other contract. DEFERMENT OF TAX160 -- The postponement of tax payments from the current year to a later year. A number of countries have introduced legislation to counter the kind of tax avoidance whereby a taxpayer obtains a deferment of tax which is not intended by law. Ex) CFC legislation DEFERRED INCOME160 -- Term used to describe income which will be realized at a future date, thus delaying any tax liability. DEFICIENCY -- The excess of a taxpayers correct tax liability for the taxable year over the amount of taxes previously paid for that year. A US concept DELINQUENCY160 -- Tax which is in default (i. e. due but not yet paid) is often referred to as a delinquent tax in North American parlance. DELIVERY160 -- Transfer of goods or an interest in goods from one person to another. DEMAND LOAN160 -- A loan payable on request by the creditor rather than on a specific date. DE MINIMIS -- Phrase used in connection with circumstances in which the full rigour of the tax law is not enforced because, in particular, of the small amount or minor breach which may be involved, particularly in the context of under-assessed or underpaid tax which are not pursued on de minimis grounds. DEPENDENT AGENT160 -- See: Agency DEPENDENT PERSONAL SERVICES160 -- The OECD model tax treaty provides rules for the treatment of salaries, wages and other similar remuneration (i. e. employment income) under the heading dependent personal services. As a general rule, with some exceptions, the right to tax income from dependent personal services is allocated to the country where the employment activities are exercised. DEPLETION -- Deductible expense which reflects the decrease of a natural resource due to extraction of the resource. DEPRECIATION160 -- An accounting technique in which the cost of an asset is allocated over its useful life. DERIVATIVE FINANCIAL INSTRUMENTS160 -- Also known as derivatives.160 These are financial instruments whose values are linked to or depend on the value of a primary (underlying) asset, e. g. debt assets, liabilities and equity securities, commodities or currency. The primary types of derivatives include forward contracts, futures, options and swaps. DESTINATION PRINCIPLE160 -- Principle under a VAT regime which mandates that VAT on goods be paid in the country where the purchaser is resident (i. e. the country of consumption) at the rate that would have applied had the goods been purchased from a domestic supplier. DIRECT CHARGE METHOD160A -- method of charging directly for specific intra-group services on a clearly identified basis. DIRECT COST160 -- Cost identified with a particular transaction, such as raw materials, components and goods, wages and other processing expenses. DIRECT INVESTMENT160 -- Description often given to a substantial investment in the shares of a company. DIRECTIVE160 -- An official order or instruction. In EU context, it means one of the legal instruments issued by the competent institutions of the European Union. A directive is addressed to the Member States requiring them to make such changes to their domestic legislation as necessary to satisfy a provision of one of the EC treaties. DIRECT METHOD OF ALLOCATION OF COSTS160 -- Allocation method where the parent company or group service centre of a multinational enterprise providing central management and other services charges each member of the group directly for individual services rendered. DIRECT TAX160 -- Direct taxes are taxes imposed on income, capital gains and net worth. Gift tax, death duties and property tax are also considered direct taxes. DISCOUNT160 -- Amount by which the face value of a debt obligation exceeds its issue or selling price. DISOLUTION OF CORPORATION160 -- The termination of the legal existence of a corporation. DISTRIBUTION160 -- A payout of cash or property from a corporation to a shareholder. DIVIDENDS160 -- A payment by a corporation to shareholders, which is taxable income of shareholders. Most corporations receive no deduction for it. DOCUMENTATION160 -- Official documents that are used to prove that something is true or correct DOMESTIC CORPORATION160 -- Corporation which is organized or has its place of effective management in a country. DOMICILE160 -- A persons domicile in English common law is his permanent home, the place to which he always intends to return. Residence is the place where an individual lives for a certain period of time, while domicile is the place where an individual makes his permanent home. DOMICILE, FISCAL160 -- Term sometimes used to mean the same as residence. Fiscal domicile does not necessarily have the same meaning as domicile. DOUBLE DIPPING160 -- Term used to indicate the possibility for dual resident companies to deduct the same expenses in two jurisdictions. DOUBLE TAXATION, DOMESTIC AND INTERNATIONAL160 -- Domestic double taxation arises when comparable taxes are imposed within a federal state by sovereign tax jurisdictions of equal rank. International double taxation arises when comparable taxes are imposed in two or more states on the same taxpayer in respect of the same taxable income or capital, e. g. where income is taxable in the source country and in the country of residence of the recipient of such income. DOUBLE TAXATION, ECONOMIC AND JURIDICAL160 -- Double taxation is juridical when the same person is taxed twice on the same income by more than one state. Double taxation is economic if more than one person is taxed on the same item. DOUBLE TAXATION TREATY160 -- See: Tax treaty DTA160 -- Double tax agreement. See Tax treaty. DUAL RESIDENCE160 -- Person or company resident in two or more countries under the law of those countries, because the two countries adopt different definitions of residence. DUTY160 -- Customs duties (sometimes called a tariff) levied on imported products. DUTY-FREE ZONE160 -- Zone usually located next to an international port or airport where imported goods may be unloaded, stored and reshipped without payment of customs duties or other types of indirect taxes, provided the goods are not imported. EARNED INCOME -- Income or compensation derived from personal services in an employment, trade, business, profession or vocation. (cf. investment income) EARNINGS amp PROFITS (EampP) 160-- A term referring to the economic capacity of a corporation to make a distribution to shareholders that is not a return of capital. Such a distribution would constitute a taxable dividend to the shareholder to the extent of current and accumulated earnings and profit under US tax law. EARNINGS BEFORE TAXES 160-- Sales revenue less cost of sales, operating expenses, and interest, before taxes have been paid. EARNINGS STRIPPING 160-- Practice of reducing the taxable income of a corporation by paying excessive amounts of interest to related third parties. ECONOMIC DOUBLE TAXATION 160-- See: Double taxation, economic and juridical ECO TAX 160-- See: Environmental tax EFFECTIVELY CONNECTED INCOME (ECI) 160-- Non-resident alien individuals and foreign corporations engaged in trade or business within the US are subject to US income tax on income, from sources both within and outside the US, which is effectively connected with the conduct of the trade or business within the US. Income is effectively connected if it is derived from assets which are used in or held for use in the US, and the activities of the US business were a material factor in the realization of the income. EFFECTIVE TAX RATE 160-- The rate at which a taxpayer would be taxed if his tax liability were taxed at a constant rate rather than progressively. This rate is computed by determining what percentage the taxpayer8217s tax liability is of his total taxable income. EMPLOYEE PROFIT SHARING 160-- System under which the employees of an enterprise are entitled by employment contract or by law to a share in the profits made by the enterprise. EMPLOYEE STOCK OPTION160-- An opportunity for employees to purchase stock (shares) in the company they work for, often at a discount from fair market value. Generally it is provided as an incentive to stay with the employer until the options vest. EMPLOYMENT INCOME 160-- Income source of individuals, covering income derived from labour or other current or former dependent personal services such as salaries, wages, bonuses, allowances, compensation for loss of office or employment, pensions and, in some countries, certain social security benefits. ENTERTAINER 160-- Income of a professional entertainer e. g. a musician, actor or other artiste, or sportsman is, in many cases, treated differently from income of persons carrying on other independent profession. ENTITY160 -- In general for tax purposes, an organization, person or party that possesses separate existence. Options include corporations, partnerships, estates and trusts. ENVIRONMENTAL TAX 160-- Tax imposed for environmental reasons, e. g. to provide an incentive to reduce certain emissions to an optimal level or taxes on environmentally harmful products. EQUAL TREATMENT 160-- General principle of taxation that requires that taxpayers pay an equal amount of tax if their circumstances are equal. EQUITABLE INTEREST 160-- An equitable interest in an asset is the interest of the beneficial owner this may or may not be the same person as the legal owner. EQUITY 160-- 1. The extent of a persons beneficial ownership of a particular asset. This is equivalent with the value of the asset minus the liability to which the asset is subject.160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160 2. Paid-in capital plus retained earnings in a corporation160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160160 3. The ownership interest possessed by shareholders in a corporation - stock as opposed to bonds. EQUITY CAPITAL 160-- A method of financing a business where money is received by the issuance of shares in the enterprise. ESOP 160-- Employee stock ownership plan ESTATE160 -- Broadly, all that a person owns, whether real property or personal property, for instance, the estate one leaves at death. ESTATE DUTYTAX 160-- See: Death duties ESTIMATED ASSESSMENT 160-- For income tax purposes, where the records kept, particularly by small traders, are inadequate for a precise calculation of tax due, it may be necessary for the taxable income or profits to be calculated by the tax authorities on the basis of an estimate. ESTOPPEL -- Rule under which one is precluded and forbidden by law to speak against his own act or deed. If a certain position has been taken, another person has relied on that, and you are aware of that reliance, there is often an estoppel against you arguing the contrary to your original position in a court proceeding. EUROBOND 160-- International bond issued by a company in a market other than its domestic market. Eurobonds may take the form of loans, debentures or convertible debentures, and maybe designated in any currency. EURODOLLARS160 -- Dollars originally deposited in US banks that are acquired by persons resident outside the United States and held abroad, mainly in Europe. Eurodollars are used by foreign banks as a method of financing loans to other local or foreign banks or to commercial borrowers. EUROPEAN COMMISSION160 -- The Commission is the executive institution of the European Union charged with the task of administering all policy within the Union. EUROPEAN UNION160 -- See: Treaty on European Union EVASION160 -- A term that is difficult to define but which is generally used to mean illegal arrangements where liability to tax is hidden or ignored, i. e. the taxpayer pays less tax than he is legally obligated to pay by hiding income or information from the tax authorities. EXAMINATION160 -- The checking of a taxpayers tax return, accounts, self-assessment calculations, etc. The process may or may not include an audit of the taxpayers own books. EXCHANGE CONTROL160 -- Restriction of the amount of a particular foreign currency that can be bought or sold EXCHANGE OF INFORMATION160 -- Most tax treaties contain a provision under which the tax authorities of one country may request the tax authorities of the other country to supply information on a taxpayer. Information may only be used for tax purposes in the receiving country and it must be kept confidential, i. e. it can only be disclosed to the persons or authorities concerned with the assessment or collection of taxes covered by the treaty. EXCISE TAX160 -- A tax imposed on an act, occupation, privilege, manufacture, sale, or consumption. EXCLUSIONS160 -- Term used to describe income which is exempt, i. e. not included, in the calculation of gross income for tax purposes. EXEMPTION METHOD160 -- See: Foreign tax relief EXEMPTIONS160 -- Tax laws frequently provide specific exemptions for persons, items or transactions, etc. which would otherwise be taxed. Exemptions may be given for social, economic or other reasons. EXPATRIATE160 -- Persons who have left their country and live abroad. EXPATRIATION RULES160 -- Rules under which a taxpayer continues to be subject to tax when he relinquishes his residence or his citizenship in order to avoid tax. EXPENSES160 -- Costs that are currently deductible, as opposed to capital expenditures, which may not be currently deducted but must be depreciated or amortized over the useful life of the property. EXPORT DUTY160 -- Tax levied on exports of basic commodities entering into world trade, such as rubber, copper, palm oil, sisal, tea, cocoa and coffee EXTENDED LIMITED TAX LIABILITY160 -- Principle according to which certain taxpayers (i. e. those subject to individual income tax, net worth tax and succession duty) who leave a tax jurisdiction and move to a low-tax country are subject to taxation in the former country of residence for a certain period of time after the move. FACTORING -- Financial transaction whereby an enterprise sells its debt-claims to a third party in order to obtain cash (although less than the full amount of the debt). The third party then assumes responsibility for the administration and collection of the debt on the due date for its own account. FAIR MARKET VALUE160 -- The price a willing buyer would pay a willing seller in a transaction on the open market. FEDERAL REGISTER160 -- A daily publication by the U. S government that prints the regulations of the various governmental agencies. FEDERAL TAX160 -- In federal states, taxation may exist on two levels: taxation by the federation or confederation, and taxation by the state or provinces. FEE160 -- Fees charged by central or local governments can be distinguished from taxes when they are charged as payments for the supply of particular services by the authorities. Fees are usually not considered taxes when listing taxes to be included in a double tax treaty. FIDUCIARY160 -- A person, company, or association holding assets in trust for a beneficiary. FIELD AUDIT160 -- An examination of a tax return by tax authorities at the taxpayers place of business. FIFO160 -- Method of valuing inventory on the basis of first in, first out, where goods or materials purchased first are regarded as those which are sold first. FINAL TAX160 -- Under tax treaties the withholding tax charged by the country of source may be limited to a rate lower than the rate which would be charged in other circumstances - this reduced rate is then the final tax in the country of source. FINANCE COMPANY160 -- A company, usually a wholly owned subsidiary, which borrows funds from within or outside a group of companies and onlends the funds to affiliates. A finance company is, in many cases, established in a low or no tax jurisdiction. FINANCE LEASE160 -- Lease where the lessor is considered only as a financier. The lessee is regarded as the owner of the leased assets. Cf. Operating Lease FINANCIAL STATEMENT160 -- Report which contains all of the financial information about a company. The report generally consists of a balance sheet, income statement and may include other information as well. FINANCIAL STRUCTURE160 -- The makeup of the right-hand side of a companys balance sheet, which includes all the ways it assets are financed. FIRST IN, FIRST OUT (FIFO)160 -- See: FIFO FISCAL DOMICILE160 -- See: Domicile, fiscal FISCAL NULLITY DOCTRINE160 -- Common law doctrine used in the UK in cases of avoidance of tax, whereby certain transactions are ignored for fiscal purposes. Cf. Substance over form doctrine. FISCAL POLICY160 -- Part of economic policy which relates to taxation and public expenditure. FISCAL RESIDENCE160 -- See: Residence FISCAL TRANSPARENCY160 -- Looking through an entity and attributing profits and losses directly to the entitys members. The profits of certain forms of enterprises are taxed in the hands of the members rather than at the level of the enterprise. Often occurs in the case of a partnership for example. FISCAL YEAR160 -- Any 12-month period which is set for accounting purpose of an enterprise. FIXED ASSETS160 -- Assets that are held by an enterprise either continuously or for a comparatively long period of time, generally more than one year FIXED BASE160 -- This term was used in the OECD and UN model tax treaties in the context of independent personal services, but the former Article 14 has been removed from the OECD Model and these issues are now generally dealt with under Article 7, dealing with business profits attributed to permanent establishments. It denotes a centre of activity of a fixed or permanent character from which such services can be carried out such as a physicians consulting room. The fixed base provision attributes the right to tax income from independent personal services to the other country (i. e. the source country) if the taxpayer has a fixed base available to him in that country and income is attributable to that fixed base. FIXED INCOME160 -- Income which does not fluctuate over a period of time, such as interest on bonds and debentures, or dividends from preference shares as opposed to dividend income from ordinary shares. FLAG OF CONVENIENCE160 -- The flag of ship is the flag of the country where it is registered. This term is used in international shipping where a ships country of registration is selected on the basis of countrys legal requirement and tax regime. FLAT TAX160 -- A tax applied at the same rate to all levels of income. It is often discussed as an alternative to the progressive tax. FLOORS160 -- The lower limits on tax benefits and detriments, e. g. in medical expense. A taxpayer must spend more than the floor for a deduction, and only the amount above the floor is deductible. FLOW-THROUGH ENTITY160 -- See Fiscal transparency FOB VALUE160 -- FOB denotes free on board. FOB value is value of goods excluding carriage, insurance and freight, i. e. roughly speaking, the domestic price in the country of origin. FORCE OF ATTRACTION160 -- Concept under which a permanent establishment is taxed by the country in which it is located not only on the income and property, but also on all income derived by its foreign head office from source in, and all property owned by the foreign head office situated in, the country where the permanent establishment is located. The OECD model treaty does not allow application of it. FOREIGN CURRENCY FORWARD160 -- See Forward contract.160 This contract serves the same purpose as a foreign currency futures contract, except that it is not standardized and entered on the informal, interbank market rather than on a formalized commodities exchange. FOREIGN CURRENCY FUTURES160 -- Exchange traded contract for the delivery of a standardized amount of foreign currency on a specific future date. The price for the foreign currency is agreed on the day the contract is bought or sold. Unlike forward contracts, futures are tradable, reflecting the standardization of contract size, specification and delivery date. FOREIGN CURRENCY OPTION160 -- Contract with an option to buysell foreign currency.160 See: option. FOREIGN CURRENCY SWAP160 -- An agreement under which two or more parties agree to exchange specified amount of two different currencies for a defined period. Over the term of the agreement, the parties exchange fixed or floating rate interest payments in their swapped currencies. FOREIGN EXCHANGE CONTROL160 -- See: Exchange control FOREIGN EXCHANGE TAX160 -- Special tax imposed on transactions involving sales of foreign exchange by domestic banking institutions and authorized exchange brokers. FOREIGN-SOURCE INCOME160 -- Generally income realized from countries outside the country of residence of the taxpayer. FOREIGN TAX CREDIT (FTC)160 -- See: Credit, foreign tax FOREIGN TAX RELIEF160 -- Relief from domestic tax on income from abroad which has already suffered foreign tax. Generally speaking, two approaches are taken to foreign tax relief, i. e. the credit method or the exemption method. FORFAIT160 -- In a number of countries tax is sometimes levied on an estimated taxable base (forfait), particularly in respect of the imposition of income tax or turnover tax on small enterprises. FORMS, TAX160 -- See: Tax form FORMULA APPORTIONMENT160 -- See: Unitary tax system FORMULATORY APPROACH160 -- See: Unitary tax system FORWARD CONTRACT160 -- Contract for the delivery of an amount of asset (e. g. foreign currency, securities, commodities) on a specific future date. FRANCHISE TAXES160 -- Nearly all states in the US levy an annual franchise tax on resident and non-resident corporations for the privilege of the right to do business in that state. FRAUD160 -- Tax fraud is a form of deliberate evasion of tax which is generally punishable under criminal law. The term includes situations in which deliberately false statements are submitted, fake documents are produced, etc. FRINGE BENEFITS160 -- Benefits supplementing normal wages or salaries. Fringe benefits may be given in the form of a money allowance, e. g. a holiday bonus or in the form of benefits in kind, e. g. free accommodation. Although most countries tax the benefit of employer-provided automobiles and accommodation, the tax treatment of other fringe benefits varies considerably. FRIVOLOUS POSITION160 -- A tax position that is knowingly advanced in bad faith and is patently improper. FRONTIER WORKERS160 -- For tax purposes, a frontier worker is a person who commutes across a border (e. g. on a daily basis) between his place of residence and his place of employment. FRONTING160 -- Term used to describe the practice of interposing a third party in a transaction so as to circumvent transfer pricing legislation. FRUIT AND TREE DOCTRINE160 -- A judicial doctrine that an individual who earns income from property of services may not assign such income to another person for tax purposes. FTC160 -- See Foreign tax credit FUNCTIONAL ANALYSIS160 -- An analysis of the functions performed (taking into account assets used and risks assumed) by associated enterprises in controlled transactions and by independent enterprises in comparable uncontrolled transactions. FURNISS V. DAWSON160 -- This case is 1984 UK case, decided by the House of Lords, which is generally considered to be a landmark case. It made ineffective tax avoidance schemes which have no commercial purpose other than the avoidance of tax. FUTURES CONTRACT160 -- An agreement between a buyer and seller to exchange particular goods (e. g. securities or commodities) for a particular price at a future date as specified in a standardized contract common to all participants in a market on an organized futures exchange. GAAP160 -- Generally Accepted Accounting Principles are the rules and practices required to be followed in keeping financial records and books of account. GAIN, CAPITAL160 -- See: Capital gain GEARING160 -- Term broadly used in the context of a companys debtequity ratio. A company is highly geared if the ratio of debt to equity is high. Sometimes referred to as capital gearing or leveraging. GENERAL PARTNER160 -- In a partnership, a partner whose liability is not limited. All partners in an ordinary partnership are general partners. A limited partnership must have at least one general partner and at least one limited partner. GENERAL PARTNERSHIP160 -- See: Partnership GENERATION-SKIPPING TAX --160Tax imposed to prevent the avoidance of transfer tax (i. e. estate tax and gift tax) over successive generations. GIFT CAUSA MORTIS160 -- A transfer of property by a person who faces impending death. The donee thereby becomes the owner of the property, but on the condition that the gift is revoked if the donor does not die. GIFT INTER VIVOS160 -- A gratuitous transfer of property made during the transferors (donors) lifetime. In many countries the gratuitous transfer of property is subject to a gift tax. GLOBAL FORMULARY APPORTIONMENT METHOD160 -- See: Global method GLOBAL HEDGING160 -- A risk-management strategy to balance positions of different business units or with unrelated third parties. GLOBAL INCOME TAX --160Income tax that aggregate income from all sources at the individual (or family unit) level. The income is then taxed at a single progressive rate. GLOBAL METHOD160 -- Under the global method, the profits of each member of a multinational enterprise (MNE) are not calculated on the basis of arms length dealings, but rather the total profit of the enterprise is allocated to the members of the multinational enterprise on the basis of, for example, the turnover of each member, the expenses incurred by each member or the labour cost of each member. GLOBAL TRADING160 -- Term used to describe transactions carried out by, inter alia, investment banks and securities dealers, involving financial instruments, financial services and financial goods. Also known as 24-hour trading since the transactions are carried out continuously during a day in financial markets worldwide. GOING CONCERN160 -- A business which is actually operating, e. g. at the time of takeover. The advantage of taking over a business as a going concern (if it is operating profitably) is usually recognized by a payment for goodwill as well as for other assets. GOING CONCERN VALUE160 -- The element of value that attaches to property as a result of the ability of a trade or business to continue to operate and generate income after a transfer of ownership. GOOD FAITH160 -- Good faith denotes a state of mind, whereby a person honestly and truly believes that certain facts or circumstances are as he says they are. GOODS AND SALES TAX160VAT -- style multi-stage sales tax levied on purchases (and lessees). Sellers (and lessors) are generally responsible for collection.160 GOODWILL160 -- Intangible asset which consists of the value of the earning capacity, location, marketing organization, reputation, clientele, etc. of a trade or business. Goodwill can be transferred for a consideration to another entrepreneur upon the sale of the business as a going concern. GORDON REPORT160 -- 1981 report submitted to the US Treasury, entitled Tax Havens and Their Use by United States Taxpayers - An Overview it explains the use of US taxpayers make of tax havens, existing anti-abuse measures and proposals for measures to counter such activities. GRACE PERIOD160 -- The period following the due date of taxes during which legal action for recovery of delinquent taxes will not be instituted and interest will not commence to run. GRADUATED RATE --160System where the rate of tax increases on marginal amounts as the amount of taxable income rises. Synonym for progressive rate. GRANDFATHER CLAUSE160 -- Clause temporarily preserving legislation which exists at the time a law is modified or a (tax) treaty is concluded (or modified). GREEN CARD160 -- Entry document issued by the US immigration and Naturalization Service (INS) that permits foreign nationals to live permanently in the US and undertake employment. GREEN CARD TEST160 -- A test in the US to determine residence of an alien individual, i. e. an alien is considered resident if at any time during the calendar year he is a lawful permanent resident of the US under the immigration laws. GROSS INCOME -- Gross receipts, whether in the form of cash or property, of the taxpayer received as compensation for independent personal services, and the gross receipts of the taxpayer derived from a trade, business or services, including interest, dividends, royalties, rentals, fees or otherwise. GROSS INCOME, TAXES ON160 -- In some countries income taxes are levied on gross income (usually at low rates) without deduction for expenses. GROSS MARGIN160 -- Ratio of gross profits to gross revenue. GROSS PROFITS160 -- The gross profits from a business transaction are the amount computed by deducting from the gross receipts of the transaction the allocable purchases or production costs of sales, with due adjustment for increases or decreases in inventory or stock-in-trade, but without taking account of other expenses. GROSS PROFIT RATIO160 -- Ratio of gross profit to the sales of a business or, alternatively, to the adjusted purchases or goods consumed during the accounting period. GROSS PROFITS TAX160 -- Tax imposed usually at low rates on the gross receipts of a business GROSS UP160 -- Add back the amount of tax which has been paid to the value of property or other income received. The term includes the process by which corporation add credits (e. g. imputation credits or foreign tax credits) received to net income received before calculating their tax liabilities. GROUP SERVICE CENTER160 -- Term used in the 1984 OECD Report on Transfer Pricing and Multinational Enterprises to denote a special department within a parent company or regional holding company or any other associated enterprise within a multinational enterprise (MNE) providing services to associated enterprises. GROUP TREATMENT160 -- Term used to describe the tax treatment where the profits and losses of associated companies may be grouped together and, in effect, be treated as the aggregated profits of a single enterprise (sometimes called a fiscal unity). GUARANTOR160 -- A person who guarantees, endorses, or provides indemnity agreements with respect to debts owed to others. HABITUAL ABODE160 -- In the context of the tie-breaker rule of the OECD model tax treaty, habitual abode is one of the criteria used to resolve the problem of dual residence. It refers to the period of time a taxpayer spends in each country. HARDSHIP CLAUSE160 -- Discretionary power of the tax authorities to mitigate any harsh results of the tax law. HARMONIZATION OF TAX, EEC DIRECTIVE160 -- Term usually used to refer to the process of removing fiscal barriers and discrepancies between the tax systems of the various countries comprising the European Union. To this end the EU has issued directives in the area of indirect and direct taxation. HEAD OFFICE EXPENSES160 -- Where an enterprise with its head office in one country operates through a branch or other permanent establishment in another country, some expenses incurred by the head office, e. g. for general management and administrative expenses or the cost of specific services provided to the permanent establishment, may be deducted in computing the taxable profits of the permanent establishment. HEDGING TRANSACTION160 -- Transaction where a person tries to protect himself against price, interest rate or foreign exchange rate fluctuations, for example, by buying or selling commodities or currencies using derivative contracts such as forwards, futures, options and swaps. HIDDEN RESERVES160 -- Reserves which are not disclosed on the balance sheet of an enterprise, either by overvaluing debts or undervaluing assets. HIDDEN TAX160 -- Indirect tax paid by the consumer without his knowledge. HISTORICAL COST160 -- Amount expended in obtaining an asset at the time of acquisition, i. e. the purchase price and associated costs. HOLDING160160 -- A decision of a court HOLDING COMPANY160 -- Company whose main purpose is to hold substantial shares of other companies. HOLDING PERIOD160 -- The length of time that an investment is owned or expected to be owned. HOMESTEAD160 -- A house and surrounding land owned and used as a dwelling. HORIZONTAL EQUITY160 -- Doctrine which holds that similarly situated taxpayers should receive similar tax treatment, e. g. taxpayers who earn the same amount of income or capital should be accorded equal treatment. HOUSE WAYS AND MEANS COMMITTEE160 -- The committee of the US House of Representatives that introduces most tax provisions. HUT TAX160 -- Type of poll tax levied on inhabited dwellings or huts generally at an early stage in the development of an economy when it is not feasible to introduce an income tax. HYBRID ACCOUNTING METHODS160 -- Term which refers to the situation where a taxpayer used a combination of accounting methods (such as accruals basis accounting or cash basis accounting) for different items of income. HYBRID DERIVATIVE160 -- Financial instrument which has the characteristic of more than one type of instrument, i. e. a swap plus an option. HYBRID ENTITY160 -- Entity that is characterized differently in two or more jurisdictions, for example, an entity that is treated as a partnership in one jurisdiction and as a corporation in another. HYBRID INSTRUMENT160 -- See: Hybrid derivative IMF160 -- See: International Monetary Fund IMMOVABLE PROPERTY160 -- Also known as real property, immovable property comprises land, houses and buildings. IMPORT DUTY160 -- See: Duty IMPOST160 -- The term impost means tax and refers particularly to a duty on imported goods and to clarification (by customs) of (imported) goods in order to assess the proper (import) taxes. IMPUTATION SYSTEM160 -- System under which at least part of the tax paid by a company on its profits is credited against the tax liability of shareholders in receipt of distributions paid by the company out of those profits. IMPUTED INCOME160 -- The economic benefit a taxpayer obtains through performance of self-provided services or through the use of self-owned property. IMPUTED INTEREST160 -- Implied interest. In a mortgage that states an insufficient interest rate, tax law will impute a higher rate and a lower principal, which will increase taxes on the receipt of payment. INBOUND TRANSACTION160 -- Term which refers to the tax treatment of foreigners doing business and investment in other countries. INCENTIVE STOCK OPTION (ISO) --160An equity-type compensation plan under which qualifying stock options are free of tax at the date of grant and the date of exercise but are taxed when sold. US system. INCIDENCE OF TAX160 -- The person who bears the tax burden in economic sense, which could be different from the person paying the tax. INCOME PROPERTY160 -- Often, real estate that is bought for the income it produces. INCOME SHIFTING160 -- Income splitting INCOME SPLITTING160 -- A number of arrangements, the essential feature of which is that income, which would have been taxed at a higher rate in the hands of the person who derived it, is taxed in the hands of another person at a lower rate. INCOME STATEMENT160 -- Statement showing the results of a business operation for a particular period of time. The statement will show the businesss revenues and expenses. INCOME SUBJECT TO TAX160 -- All sources of income liable to tax without taking account of tax allowances. INCOME TAX CREDIT160 -- See: Credit, tax INCORPORATION160 -- The process by which a company receives a government charter allowing it to operate as a corporation. INDEMNIFICATION160 -- Amount of money received by persons or entities as compensation for damages or for losses incurred. INDEPENDENT AGENT160 -- See: Agency INDEPENDENT CONTRACTOR160 -- A contractor who is self-employed. INDEPENDENT ENTERPRISES160 -- Two enterprises are independent enterprises with respect to each other if they are not associated enterprises with respect to each other. INDEPENDENT PERSONAL SERVICES160 -- Services performed by an independent contractor. An independent contractor is hired to do work according to his own methods and is not subject to the control of an employer except as to the result of his work. With the removal of Article 14 from the OECD Model, this issue is now dealt with by Article 7 as business profits in most cases. INDEX-LINKED ADJUSTMENT160 -- Expedient adopted in many commercial transactions to provide a workable solution to some of the problems created by inflation and monetary depreciation. The mechanism is essentially one of adjusting payments, profits, gains, taxable income brackets, tax allowances, etc. by discounting or otherwise modifying them by reference to an accepted index of inflation or other indices. INDEXATION160 -- See: Index-linked adjustment INDIRECT-CHARGE METHOD160 -- A method of charging for intra-group services based upon cost allocation and apportionment methods. INDIRECT COST160 -- Costs that cannot be identified in relation to a particular activity but that, nevertheless, are related to the direct costs (e. g. overhead expenses, costs of supporting departments, and a proper share of research and development (RampD) costs). INDIRECT TAX160 -- Tax imposed on certain transactions, goods or events. Examples include VAT, sales tax, excise duties, stamp duty, services tax, registration duty and transaction tax INDIRECT TAX CREDIT160 -- See: Credit, underlying (indirect) tax INFORMATION RETURN160 -- Declaration made by a person who has economic information about a potential taxpayer, regardless of whether that person is liable for withholding tax. INHERITANCE160 -- Real property or personal property that is received by heirs. IN KIND160 -- Broadly speaking, a distribution or payment other than in money. INPUT TAX160 -- Term used in connection with VAT to denote the tax embodied in purchases made by a trader or entrepreneur who will usually be able to obtain a credit for the tax that his suppliers have paid on the goods supplied to him which form his inputs. INSOLVENCY160 -- Inability to pay debts when due INSTALMENT SALE160 -- Sale for which the consideration is received by way of more than one payment or instalment. INSTRUMENT160 -- A legal document that records an act or agreement and provides the evidence of that act or agreement. Instruments include contracts, notes, and leases (e. g. a debt instrument). INSURANCE PREMIUMS160 -- The amount paid to an insurance company to cover potential hazards. INSURANCE SETTLEMENT160 -- Receipt of proceeds of an insurance policy. INTANGIBLE PROPERTY160 -- Property which has no physical existence but which has a value based on a legal right of the owner, e. g. goodwill, patent, trade mark, copyright, software, inventions, designs, i. e. all manner of intellectual property. Intangible property is usually transferred by way of a licensing agreement, and payments for the intangible are made in the form of royalties. INTEGRATION, FULL -- System which provides for retained as well as distributed profits to be included within the framework of an imputation system. All corporate-source income, whether retained or distributed, is taxed at the appropriate marginal rate in the hands of ultimate shareholders. INTELLECTUAL PROPERTY160 -- Literary, dramatic, musical, artistic and scientific works are intellectual property which is protected by copyright, patent, registered design, trade mark, etc. INTENTIONAL SET-OFF160 -- A benefit provided by one associated enterprise to another associated enterprise within the group that is deliberately balanced to some degree by different benefits received from that enterprise in return. INTER ALIA160 -- Latin for among other things INTERCOMPANY PRICING160 -- See: Transfer pricing INTERCOMPANY TRANSACTIONS160 -- Transactions between members of an affiliated group filing a consolidated return gain or loss is deferred until a property is disposed of outside the group. INTERCORPORATE DIVIDENDS160 -- Dividends distributed between two companies (domestic or foreign) arising from a shareholding or participation in the capital of the paying company. INTERMEDIARY COMPANY160 -- See: Conduit company INTERNAL MARKET160 -- In the context of the European Union, an area without internal frontiers in which the free movement of goods, persons, services and capital is ensured. INTERNAL REVENUE BULLETIN (IRB)160 -- A weekly publication summarizing various IRS administrative rulings. INTERNAL REVENUE CODE (IRC)160 -- Legislation passed by US Congress that specifies what income is to be taxed, how it is to be taxed, and what may be deducted from taxable income. INTERNAL REVENUE MANUAL (IRM)160 -- An official compilation of policies, procedures, instructions, and guidelines for the organization, functions, operation, and administration of the Internal Revenue Service. The IRM guidelines do not confer any rights on taxpayers. INTERNAL REVENUE SERVICE (IRS)160 -- The agency of the US federal government that is responsible for the administration and collection of federal taxes. INTERNATIONAL DOUBLE TAXATION160 -- See: Double taxation, domestic and international INTERNATIONAL MONETARY FUND (IMF) --160An international organization established in 1945, headquartered in Washington, DC. The purposes of the IMF are, inter alia, to promote international monetary cooperation, facilitate the expansion and balance growth of international trade and promote stability in foreign exchange. INTERNATIONAL TAXATION160 -- Traditionally, international taxation refers to treaty provisions relieving international double taxation. In broader terms, in includes domestic legislation covering foreign income of residents (worldwide income) and domestic income of non-residents. INTRA GROUP SERVICES160 -- Services provided by a group company to another affiliated company. The cost of general services such as management, administrative and similar services may be often allocated among the various members of the group without any profit mark-up, whereas services performed in the ordinary course of business are subject to arms length conditions. INVESTMENT160 -- The purchase of stocks, bonds, mutual fund shares, real property, an annuity, collectibles, or other assets, with the expectation of obtaining income or capital gains-or both-in the future. INVESTMENT ALLOWANCE160 -- Allowance with respect to a qualifying depreciable asset. It adds a certain percentage of the assets initial cost to the full depreciation write-off and is usually given in the year of acquisition or as soon as possible thereafter. INVESTMENT COMPANY160 -- Corporation whose activities consist exclusively or substantially of making investments (i. e. holding property and collection of income therefrom) and whose buying and selling of shares, securities, real estates or other investment property is only incidental to this purpose. INVESTMENT DEDUCTION160 -- See: Investment allowance INVESTMENT GOODS160 -- See: Fixed assets INVESTMENT INCENTIVES160 -- Financial and tax incentives used to attract local or foreign investment capital to certain activities or particular areas in a country. INVESTMENT INCOME160 -- Income derived from the investment of capital, whether money or other property, in income-producing assets or in a profit-making venture without active participation in the production of the income or in the affairs of the venture. INVESTMENT METHOD160 -- Method used in connection with VAT where an immediate credit is granted against tax for that part of expenditure incurred during the year for acquisition of business assets (such as plant and machinery by a manufacturer) which related to the tax element in the price of such assets. INVESTMENT RESERVE160 -- This system permits eligible taxpayers to set aside part of their profits as a reserve for future investment and deduct from their income the amount of the annual contribution to the reserve. INVOICE BASIS160 -- Method of applying VAT to the price at which the goods or service are invoiced, with a deduction for the tax (if any) charged at previous stages. INVOICE COMPANY160 -- Term used in the context of transfer pricing to refer to a company established in a low-tax or no-tax jurisdiction for the purpose of shifting profits to that jurisdiction. IRB160 -- See: Internal revenue bulletin IRC160 -- See: Internal revenue code IRM160 -- See: Internal revenue manual IRS160 -- See: Internal revenue service ISSUED SHARE CAPITAL160 -- Shares that have been sold to shareholders by the corporation ITEMIZED DEDUCTIONS160 -- In the US a deduction as specifically set forth in the Internal Revenue Code. The deductions in this part are individually listed, item by item. JEOPARDY ASSESSMENT 160-- Tax assessment made where there is some danger of tax being lost. JOINT RETURN160 -- A single return made jointly by husband and wife. JOINT-STOCK COMPANY160 -- Company with legal personality and whose capital is divided into shares. The shareholders are generally liable only to the extent of the nominal value of their shares. JOINT VENTURE160 -- Term which is loosely used to describe a relationship between parties carrying on an undertaking in common for their individual or common gain. This can be either an incorporated venture or an unincorporated venture. JUNK BOND160 -- Bonds and debentures issued by companies that have a low credit evaluation (i. e. below investment grade) from a rating agency such as Standard amp Poors or Moodys JURIDICAL DOUBLE TAXATION160 -- See: Double taxation, economic and juridical JURISDICTION160 -- The power, right, or authority to interpret and apply tax laws or decisions. - K - KIDDIE TAX160 -- Term used to describe tax levied in the US on the unearned income of a child under 14. The income is taxed at the parents highest rate of tax. KNOW-HOW160 -- All undivulged technical information, whether or not capable of being patented, that is necessary for the industrial reproduction of a product or process, i. e. knowing how a product is made or how a particular process works. Payments for know-how may be taxed as royalties in many cases. The distinction from contracts for the provision of services is addressed in the OECD Commentary to Article 12. LANDED COST160 -- Term used in relation to the importation of goods which means the sum total of the cost of the goods concerned, the amount of customs duties levied on those goods and the expense incurred in unloading them. LAST IN, FIRST OUT160 -- See: LIFO LEASE160 -- In general, a lease is a contract in respect of real or personal property, under which the owner of the property grants to another the right to possess, use and enjoy the property for a specified period of time in exchange for periodic payments. LEASEBACK160 -- See: Sale and leaseback LEGAL ENTITY160 -- Generally, corporations, joint-stock companies and limited liability companies are regarded for tax purposes as having an existence separate from that of their shareholders. Conversely, for tax purposes a partnership is often not regarded as a separate legal entity, its profits being taxed in the hands of the individual partners. What constitutes a legal entity for tax purposes may or may not coincide with what constitutes a legal entity for general law purposes. LEGAL RESERVE 160-- Under the civil law of some countries corporations are required to maintain a legal reserve for all needs which may arise in the course of the business. Tax law does not allow a deduction for such a reserve. LETTER-BOX COMPANY160 -- A paper company, shell company or money box company, i. e. a company which has compiled only with the bare essentials for organization and registration in a particular country. The actual commercial activities are carried out in another country. LETTER RULING160 -- See: Advance ruling LEVEL PLAYING FIELD160 -- This term denotes to reduce, by means of tax policy, the differences in the taxation of internationally mobile entities or transactions allowing countries to compete fairly on non-tax factors. LEVERAGING160 -- See: Gearing LIBOR160 -- The London inter-bank offering rate is the rate at which London money banks lend to each other. LICENSE DUTIES (OR FEE)160 -- Annual duties payable for the privilege of carrying on a certain trade. LICENSING160 -- Licensing is an agreement by which a licensor transfers the right to use his technology andor know-how to a licensee for the production or manufacturing of a product in the licensees country. Royalties are generally paid for the right to use the technology or know-how. LIEN160 -- A charge against property, making it security for the payment of a debt, judgment, mortgage, or taxes. LIFE INTEREST160 -- Assets may be given to a person for his lifetime use or benefit, with the stipulation that after his (the life tenants) life, the asset will pass to another beneficiary. LIFE TENANCY160 -- Under common law an interest in possession whereby the individual beneficiary is entitled to the income of a trust or settlement until his death. LIFO160 -- Method (last in, first out) of valuing inventory or stock-in-trade whereby the goods or materials purchased last are regarded as those which are sold first. LIMITATION ON BENEFITS PROVISION160 -- Tax treaty provisions designed to restrict treaty-shopping opportunities by limiting treaty benefits to persons who meet one of several enumerated tests, which may require minimum level qualifications, e. g. local ownership. LIMITATIONS, STATUTE OF160 -- See: Statute of limitations160 LIMITED LIABILITY160 -- Liability of investor which is limited to the extent of his investment LIMITED LIABILITY COMPANY (LLC)160 -- Business form that combines the flexibility and tax advantages of a partnership with the limited liability features of a joint-stock company. An LLC may be taxed as a partnership or a corporation depending on the nature of the status under which it is organized. LIMITED (SPECIAL) PARTNER160 -- See: Limited partnership LIMITED PARTNERSHIP160 -- Business entity made up of two types of partners: general partners and limited partners, the extent of whose liability depends on their role and contribution to partners. A general partner is involved in the management and day-to-day operation of the partnership and is jointly and severally liable for all obligations of the partnership. A limited partner only makes a financial contribution to the partnership and shares in the profits he is liable for partnership obligations only to the extent of his investment. Limited partners are usually restricted from taking an active part in the management of the business of the partnership or from allowing their name to be used in the conduct of the business. LINK STRUCTURE160 -- Structure operating as a result of the different rules in various countries for determining the place of residence it is a means used by dual resident companies to obtain tax relief in two countries. LIQUIDATION160 -- A company in liquidation is a company in the process of being dissolved or wound up, and its assets, if any, after payment of its debts, distributed to the shareholders. LISTED COMPANY160 -- Company whose shares are traded on a recognized stock exchange. LISTED SECURITIES160 -- See: Quoted securities LLC160 -- See: Limited liability company LOAN CAPITAL160 -- See: Debt capital LOCAL TAX160 -- In countries where there is a central or federal government and separate levels of government at state, provincial, county or city levels, taxes levied at the lower levels of government are commonly referred to as local taxes. LOCATION OF ASSETS160 -- The location of an asset is relevant to the determination of whether it is within a taxing authoritys jurisdiction. Location of immovable property in a country means, in most countries, that the country taxes the income derived therefrom and possibly the value and capital gains realized on alienation, even if the owner is not a resident of that country. LOCATION SAVINGS160 -- Term used in the context of transfer pricing to refer to the savings or benefits such as cheaper production or service costs obtained by siting particular manufacturing operations in an offshore jurisdiction. LONG-TERM CAPITAL GAINS160 -- In countries where capital gains are subject to special tax treatment, a distinction may be made between capital gains realized after a short period of time and capital gains realized after a longer period of time. Long-term capital gains may be taxed at reduced rates. LOOKING THROUGH160 -- Term typically used when disregarding the separate legal identity, for example, a company, in order to charge tax on a shareholder in respect of his share of the company profits. LOOPHOLE160 -- Opportunities available in tax law to minimize a taxpayers tax burdens. LOSSES160 -- The term may broadly be defined as the excess of expenses over revenues for a period, or the excess of the cost of assets over the proceeds when the assets are sold or otherwise disposed of, or abandoned or destroyed. LOSS RELIEF160 -- Most income tax laws provide some form of relief for losses incurred, either by carrying over the loss to offset it against profits in previous years (carry-back) or in future years (carry-forward) or by setting off the loss against other income of the same taxpayer in the year in which the loss was incurred. LOTTERY TAX160 -- Tax on the sale of lots or on the receipt of prizes after the drawing of lots. LUMP-SUM DEDUCTIONS160 -- Deduction, often from income, for the computation of taxable income, which does not reflect the factual situation. LUMP-SUM EXEMPT AMOUNTS160 -- Fixed sum of income, net worth, etc. below which no tax is due. LUMP-SUM RATES160 -- In specific cases, income tax (and other taxes) may be levied at a fixed rate instead of the rates usually applicable. LUMP-SUM TAXATION160 -- The tax laws of some countries allow the tax authorities to levy a fixed amount of taxes on income in certain circumstances which deviates from the normal method of applying a rate to income to ascertain taxes payable. LUXURY TAXES160 -- Indirect ad valorem tax imposed on supplies of specific non-essential and normally expensive commodities that are arbitrarily considered (e. g. toiletries, cosmetics, jewellery, pearls and precious stones and metals, etc.) MAINTENANCE EXPENSES160 -- 1. Expenses incurred by a taxpayer to provide for his family, former spouse or other relatives. 2. Expenses for the upkeep or preservation of a building or equipment. MALPRACTICE160 -- Improper or immoral conduct of a professional in the performance of his duties, done either intentionally or through carelessness or ignorance commonly applied to accountants, tax preparers, and lawyers to denote negligent or unskilful performance of duties where professional skills are obligatory. MANAGEMENT, PLACE OF160 -- See: Place of management MANAGEMENT, PLACE OF EFFECTIVE160 -- See: Place of effective management MANAGEMENT EXPENSES160 -- Generally the expenses of management are deductible in arriving at the taxable profits of an enterprise carrying on a trade. In the case of a group of companies it may be important to decide how far the general expenses of management of the group should be charged out to and recovered from the members of the group. MANAGEMENT FEE160 -- Broadly, a fee or charge imposed for management andor administrative services of a parent company or head office. MANAGEMENT SERVICE160 -- See: Intra-group services MAP160 -- See: Mutual agreement procedure MAP APA160 -- See: BAPA MARGINAL RATE OF TAX160 -- Tax rate applicable to the top slice or bracket of a taxpayers income or other taxable income, where the relevant tax on such items is levied at progressive rates. MARKETABLE SECURITIES160 -- See: Quoted securities MARKETING INTANGIBLE160 -- An intangible that is concerned with marketing activities, which aids in the commercial exploitation of a product or service andor has an important promotional value for the product concerned. MARK TO MARKET160 -- Tax andor accounting convention under which the value of assetsliabilities is adjusted to reflect fair market value of a specific date. MARK-UP160 -- An increase in the price of something, especially from the price a trader pays for something to the price he sells it for. In the context of transfer pricing, one method to estimate an arms length price for transactions between affiliated companies is to increase the suppliers cost by an appropriate profit mark-up (Cost-plus method). MEMORANDUM OF UNDERSTANDING (MOU)160 -- In the context of a tax treaty, a document exchanged between the treaty partners which sets out the understanding of the parties regarding the convention. Usually this does not have treaty status, but the status depends on the document itself. MERGER160 -- Term generally used to describe a number of operations involving the reorganization of companies. MINERAL ROYALTIES160 -- Regular payments, usually based on the volume or price of minerals extracted, made by mining enterprises to national states or other owners of mineral resources as consideration for the right to exploit particular mineral resources. MINIMUM TAX160 -- In certain countries corporations are always liable to a certain amount of annual tax, regardless of whether they have realized a profit. MINISTRY OF FINANCE (MOF)160 -- Department of government generally responsible for formulating monetary policy, implementing the tax laws, collecting revenue, etc. MIXER COMPANY160 -- Term used to designate an intermediate holding company the purpose of which is to mix income from various foreign sources in order to maximize the benefit of foreign tax credits. The mixer company receives income both from countries with a higher tax rate than that of the destination country and from countries with a lower tax rate, which it then pays out as a dividend. This structure has the effect of averaging out the rate of foreign tax paid. MNC160 -- Abbreviation for multinational corporation MNE160 -- Abbreviation for multinational enterprises MODEL TAX CONVENTIONS (TREATIES)160 -- A model tax treaty is designed to streamline and achieve uniformity in the allocation of taxing right between countries in cross-border situations. Model tax treaties developed by OECD and UN are widely used and a number of countries have their own model treaties. MORTGAGE160 -- A written instrument that creates a lien upon real estate as security for the payment of a specified debt. MORTGAGE TAX160 -- Tax on mortgages usually in the form of a stamp duty levied on the mortgage document. MOTIVE TEST160 -- Test often found in tax rules which are designed to prevent tax avoidance. For example, the rules may provide that certain consequences will follow if the sole, main or principal purpose of certain transaction is the reduction of tax. MOU160 -- See: Memorandum of Understanding MULTINATIONAL ENTERPRISES (MNE)160 -- Company or group of companies with business establishments in two or more countries. MULTIPLE CAPTIVES160 -- Company which has more than one captive insurance company. MULTI-STAGE TAX SYSTEM160 -- Indirect tax charged on the same goods at successive stages of production and distribution. MUTUAL AGREEMENT PROCEDURE (MAP)160 -- A means through which tax administrations consult to resolve disputes regarding the application of double tax conventions.160 This procedure, described and authorized by Article 25 of the OECD Model Tax Convention, can be used to eliminate double taxation that could arise from a transfer pricing adjustment. MUTUAL ASSISTANCE160 -- Mutual assistance in the context of tax treaties is that one of the contracting states will collect taxes due to the other contracting state. See optional Article 27 of the OECD Model. MUTUAL FUND160 -- A type of regulated investment company that raises money from shareholders and invests it in stocks, bonds, options, commodities, or money market securities. Or portfolio of securities held by an investment company on behalf of investors. NATIONALITY PRINCIPLE160 -- The nationality of a taxpayer may affect the manner in which he is taxed and the nature of his tax burden, but comprehensive income tax treaties commonly provide that foreign taxpayers should not suffer discriminatory taxation by reason of their nationality. NEGATIVE INCOME TAX160 -- A proposed system of providing financial aid to poverty-level individuals and families, using the mechanisms already in place to collect income taxes. Low-income person or family would receive a direct subsidy, called a negative income tax. NEGLIGENCE160 -- A lack of due care or failure to do what a reasonable and ordinarily prudent person would do under the given circumstances. NET INCOME160 -- Net income is gross income less deductible income-related expenses. Many countries levy income tax on this basis. NET OPERATING LOSS160 -- Amounts by which business expenses exceed income in a tax year. A traders operating losses constitute broadly the excess of his operating expenditure over receipts from his operations. NET PROFIT160 -- Difference between receipts from business transactions and deductible business expenses, subject to any adjustments for tax purposes. NET PROFIT MARGIN160 -- Ratio of operating profits to gross income (or revenue) NET WEALTH TAX160 -- See: Net worth tax NET WORKING CAPITAL160 -- Current assets less current liabilities. NET WORTH TAX160 -- Many European countries impose the net worth tax in the context of property taxation. The taxable base for resident taxpayers is normally the taxpayers worldwide net worth, i. e. total assets less liabilities along with deductions and exemptions specially allowed by tax laws. NEXUS160Link.160 -- Often a requirement in tax law for determination of taxability or deductibility. For example, expenses are deductible if they have a 8220nexus8221 with gross income.160 In US, the taxable income of a multistate corporation may be apportioned to a specific state only if the corporation has a sufficient nexus in the state. NOMINAL CAPITAL160 -- Amount of capital that is defined as such in the articles of incorporation. Usually, a certain minimum amount of nominal capital is required to establish a legal entity. NOMINAL VALUE160 -- See: Par value NOMINATIVE SECURITIES160 -- See: Registered securities NON-DISCRIMINATION160 -- Tax treaties frequently contain a non-discrimination article which stipulates that citizens or nationals of one country resident in the other country may not be subjected to local taxation which is different from or more burdensome than the tax to which citizens and nationals of the host country are subjected under the same circumstances (including as to residency). NON-QUALIFIED STOCK OPTION160 -- A stock option that does not meet the incentive stock option requirement under US tax law. The spread is taxed as ordinary income. NON-RECOURSE DEBT160 -- A debt for which an individual has no personal liability. For example, a lender may take the property pledged as collateral to satisfy a debt, but has no recourse to other assets of the borrower. NON-RESIDENT160 -- Broadly speaking, a person who spends most of the calendar year outside his country of domicile. Non-residents are usually taxed on income derived from sources within the taxing jurisdiction whereas residents may be taxed on worldwide income. NON-RESIDENT ALIEN160 -- A non-resident individual who is not a citizen or national of the taxing jurisdiction. NOTICE OF ASSESSMENT160 -- The written decision of the tax authorities after a review of a taxpayers return, whereby the amount of taxable income is determined and the amount of tax due is calculated. NOTICE OF DEFICIENCY160 -- See: Deficiency OECD160 -- The OECD (Organization for Economic Co-operation and Development) is a multilateral organization comprised of 30 countries, which are mostly Western European countries and other industrialized countries including US and Japan. Founded in 1961, the OECD provides a forum for representatives of countries to discuss and attempt to coordinate economic and social policies. It has an especially significant role in international tax matters.160 Its website is oecd. org .160 OECD MODEL TAX TREATY160 -- See: Model tax treaty OFFENCE, TAX160 -- Tax offences may be specified in the tax laws covering matters such as late filing, late payment, failure to declare taxable income or transactions, and negligent or fraudulent misstatements in tax declarations. OFFICE160 -- For purpose of the application of a tax treaty, the office of an enterprise normally forms a permanent establishment if the business of that enterprise is wholly or partly carried on through that office. OFFICE AUDIT160 -- An examination at a tax authority8217s office, generally of an uncomplicated tax matter. OFFSHORE BANK160 -- Offshore banking business basically consists of borrowing in foreign currencies for non-resident depositors outside the country and relending the foreign currencies to other non-residents. A number of countries have special regime for the taxation of offshore banks. OFFSHORE COMPANY160 -- Term usually applied to a company registered in a country (often a tax haven) other than the country or countries in which it carries on its business activities. An offshore (or non-resident owned) company is commonly used for captive insurance, marketing abroad, international shipping and tax shelter schemes. OID160 -- See: Original issue discount OMBUDSMAN160 -- A member of the US IRS Commissioners immediate staff who directs the IRSs Problem Resolution Program 8220ON CALL8221 SERVICES160 -- Services provided by a parent company or a group service centre, which are available at any time for members of an MNE group. ONE HUNDRED AND EIGHTY-THREE (183) DAYS RULE160 -- Presence in a country for 183 days or more in any 12-month period may have tax consequences, particularly in respect of an individuals residence for tax purposes or for the taxation of employment income (although other tests must also be met). ONSHORE COMPANY160 -- Term sometimes used to denote the converse of offshore company. ONUS OF PROOF160 -- The burden and responsibility of proving an assertion.160 Widely adopted principle in tax law, for example, where the taxpayer has the basic responsibility of declaring his taxable income or transactions. OPERATING LEASE160 -- Lease where the lessor is regarded as the owner of the leased asset for tax purposes. Cf. Finance Lease OPTION160 -- Derivative financial instrument consisting of a firm agreement granting one party the right but not the obligation to buy or sell commodities, securities or currencies at a specified future date at a specified price. OPTION TO BE TAXED160 -- In the VAT context, a VAT exempt entrepreneur sometimes can claim to be subject to VAT, the advantage being that to be entitled to his input tax against his output tax. ORDINARY SHARES160 -- Ordinary shares (also known as common stock) are generally shares with an equal par value and bear equal rights and obligations such as the right to participate in the management of the company by voting at the shareholders meeting and the right to receive dividends. The rights of ordinary shareholders to receive dividends are generally subordinate to the rights of bond holders and preference shareholders. ORIGINAL ISSUE DISCOUNT (OID) 160-- A discount from par value at the time a bond is issued. The most extreme version of an OID is a zero-coupon bond, which is originally sold far below par value and pays no interest until it matures. ORIGIN PRINCIPLE160 -- Principle under a VAT regime where goods are taxed in the country where they are produced, i. e. they are taxed on the basis of their place of production or origin. OTHER INCOME -- Income not otherwise mentioned in a tax treaty is frequently dealt with in a separate article, entitled other income. OUTBOUND TRANSACTION160 -- Term which refers to the tax treatment of a countrys residents (and perhaps citizens) doing business and investing abroad. OUTPUT TAX160 -- Term used in connection with VAT to denote the tax payable on the sales of goods or services by those who are subject to the tax and in contrast to the input tax for which a credit will be available. OVERHEAD EXPENSES160 -- The general expenses of a business as opposed to the direct cost of producing a good or service. Overhead costs is a term which may, in tax matters, also be used for costs incurred by the head office of a concern for the benefit of branches or subsidiaries. OVERSEAS160 -- In the United Kingdom the term overseas is generally used instead of foreign because foreign cannot be applied to commonwealth countries or to territories which are British possessions, such as the British Virgin Islands, the Isle of Man and the Channel Islands. PAID-IN CAPITAL160 -- The capital received by a corporation from investors for stock, as distinguished from capital generated by earnings or donated. PAPER160 COMPANY160 -- See: Letter-box company PARENT COMPANY160 -- Company with a substantial participation in the share capital of another company, called the subsidiary. PARTICIPATION EXEMPTION160 -- See: Affiliation privilege PARTNER160 --160A member of partnership PARTNERSHIP160 -- Association of two or more person (individuals or companies) formed for the purpose of making a profit. A partnership can be a general partnership or a limited partnership depending on the extent of each partys liability. A general partnership is characterized by the unlimited liability of the general partners for partnership debts. Also see: Limited partnership. Some countries treat a partnership as a separate taxpayer and may subject it to tax on its income and losses as a corporation. Other countries do not consider a partnership to be a separate legal entity and the partnership is treated as tax transparent, with each individual partner being taxed on his share of the profits according to his interest in the partnership. Taxation of partnerships is addressed in the Commentary to Article 1 of the OECD Model. PAR VALUE160 -- Assigned value printed on a share certificate. Face value. PASSIVE INCOME160 -- Income in respect of which, broadly speaking, the recipient does not participate in the business activity giving rise to the income, e. g. dividends, interest, rental income, royalties, etc. PASS-THROUGH ENTITY160 -- A nontaxable entity such as a partnership. Generally, the income or expense is passed to the underlying owner. PATENT160 -- Form of intellectual property. The inventor of a new article or process usually registers his invention with a government department which confers on him the sole right (known as a patent right) to use the invention for a limited period of time. PATRON160160 -- A person who does business with a cooperative, but is not necessarily a member. PATRONAGE DIVIDEND -- A payment to a patron of a cooperative. PAYROLL TAX160 -- Tax charged on an employers payroll (i. e. gross salaries, wages and other remunerations) paid to his employee without regard to their domicile, family status or other individual circumstances. PE160 -- See: Permanent establishment PENALTIES160 -- Administrative penalties are imposed for tax offences, such as failure to make a timely return or payment, negligence, and making a false return or statement. They take the form of additions to the tax and are assessed as part of the tax. Criminal penalties, on the other hand, are enforceable only by prosecution. A prison sentence may be imposed for serious tax fraud. PER CAPITA160 -- Latin for for each person PER DIEM160 -- Latin for by the day referring to daily allowance, usually for travel, entertainment, employee compensation, or miscellaneous out-of pocket expenses incurred while conducting a business transaction. PERMANENT ESTABLISHMENT (PE)160 -- Term used in double taxation agreement (although it may also be used in national tax legislation) to refer to a situation where a non-resident entrepreneur is taxable in a country that is, an enterprise in one country will not be liable to the income tax of the other country unless it has a permanent establishment thorough which it conducts business in that other country. Even if it has a PE, the income to be taxed will only be to the extent that it is 8216attributable8217 to the PE. PERSONAL ALLOWANCES160 -- Personal allowances are granted to individuals as deductions from income in computing their taxable income. There is usually a deduction for the individual himself, spouse, children and other dependents. PERSONAL HOLDING COMPANY160 -- Company, the shares of which are principally owned by or attributed to the taxpayer, and which is set up to receive his investment income. PERSONAL PROPERTY160 -- Things movable, as distinguished from real property or things attached to the realty also called 8220personalty8221. PERSONAL SERVICE CORPORATION160 -- A corporation the principal activity of which is the performance of personal services for example, a management consulting company which sends its personnel to prepare a report on a client company. PETITION160 -- A written application addressed to a court or judge, and stating facts and circumstances relied upon as a cause for judicial action. PHANTOM STOCK PLAN160 -- A deferred-compensation plan that uses the employers stock in the business as a measuring rod for determining the value of the compensation payment. Hypothetical shares of stock are allocated to the employee, and accrued appreciation andor dividends to the hypothetical shares are paid in cash to the employee. PIERCING THE CORPORATE VEIL160 -- The process of imposing liability for corporate activity, in disregard of the corporate entity, on a person or entity other than the offending corporation itself a US legal doctrine. PLACE OF EFFECTIVE MANAGEMENT160 -- Place of effective management is the test suggested in the tie-breaker rule of the OECD model tax treaty to determine the residence of a company where under the domestic laws of both contracting states the company is resident in both of them. The test determines that in such cases the company would, for treaty purposes, be resident in the state in which its place of effective management is situated. PLACE OF MANAGEMENT160 -- For purposes of the application of a tax treaty, the place of management of an enterprise normally forms a permanent establishment. The term place of management as such is not defined in the OECD model tax treaty, but may be defined in national tax law. POOL BASIS160 -- Collective basis for the purpose of depreciation of business assets falling within the same category. For example, all depreciable assets of a similar kind are effectively treated as a single asset for depreciation purposes. PORTFOLIO INTEREST160 -- Category of interest that may be paid from US sources free of withholding tax provided certain requirements are met. The portfolio interest exemption does not apply to bank loans made in the ordinary course of business. PORTFOLIO INVESTMENT160 -- A portfolio investment in a company would be a holding of shares amounting to a small portion of the total shares of the company, e. g. less than 10. Portfolio investors may receive different tax relief or other treatment in respect of their dividends under tax treaties from those accorded to other direct investors. POSSESSIONS OF U. S.160 -- In general, any US island, cay or reef that is not part of any of the 50 states. For tax purposes, possessions include Puerto Rico, the Virgin Islands, the Marshall Islands, the Federated States of Micronesia, American Samoa, Guam, the Canal Zone, Mariana Islands, Johnson Island, and Wake Island. POWER OF ATTORNEY160 -- Instrument in writing by which one person, as principal, appoints another as his agent and confers upon him the authority to perform certain specified acts or kinds of acts on behalf of the principal. PRECEDENT160 -- The doctrine of precedent in Anglo-American legal system obliges courts to adhere to principles enunciated in previously decided cases when making adjudications in cases involving the same material facts and legal issues. PREFERENCE SHARES160 -- Shares which carry a right to a prior and usually fixed dividend, ahead of dividends paid to ordinary shareholders. PREFERRED STOCK160 -- See: Preference shares PREMIUM160 -- In the context of a derivative financial instrument, a premium is the amount a purchaser pays for an option. In the context of a bond or other debt instrument, it is the amount paid in excess of the face amount. PREMIUM AT THE ISSUE OF SHARES160 -- Excess of issue value over par value in issuing corporate shares. It is a contribution to capital and not taxed as profits. PREPARATORY ACTIVITIES160 -- See: Auxiliary activities PRESUMPTIVE TAXATION160 -- Concept of taxation according to which income tax is based on average income instead of actual income. PRE-TAX PROFITS160 -- Profit after deducting depreciation, costs, etc. but before deducting taxes. PRICE INCREASE RESERVE160 -- Reserve to take account of expected increase in prices of goods, raw materials, etc. which must be replaced in the course of business. PRIMARY ADJUSTMENT160 -- An adjustment that a tax administration in a first jurisdiction makes to a companys taxable profits as a result of applying the arms length principle to transactions involving an associated enterprise in a second tax jurisdiction. PRINCIPAL AMOUNT160 -- The face value of an obligation, such as a bond or a loan, which must be repaid at maturity, as separate from the interest. PRINCIPAL PLACE OF BUSINESS160 -- The place where a person does business most of time. PRIVATE RULING160 -- Ruling granted by the tax authorities to a single taxpayer, usually with respect to a single transaction or series of transactions. Normally the ruling can be relied upon only by the taxpayer to whom it is issued, not by other taxpayers, and is binding upon the tax authority provided all relevant facts have been disclosed. PRIVILEGED TAX REGIME160 -- Euphemism for the tax regime of a tax haven. PRIVILEGE (DIPLOMATIC)160 -- Under the general rules of international law or under the provisions of special agreements, diplomatic agents and consular officers are in most cases exempt from tax in the state to which they are seconded. Many tax treaties include a clause that the right to tax income arising from outside the state is reserved to the sending state. PROFESSIONAL SERVICES160 -- Services independently performed by members of the liberal professions (i. e. physicians, lawyers, accountants, etc.) and other activities of an independent character. PROFIT -- Broadly, the excess of revenue over expenditure. PROFIT AND LOSS STATEMENT160 -- Income statement PROFIT MARK-UP160 -- Method to find an arms length price, by taking the vendors cost and adding an appropriate profit mark-up. PROFIT METHOD160 -- Method used in transfer pricing cases that looks at the profits arising from controlled transactions of one or more of the associated enterprises participating in such transactions. PROFIT RATIO160 -- Term used to denote the ratio of profits of an enterprise to its capital or net worth, and sometimes used as a basis for taxation. PROFIT SHIFTING --160Allocation of income and expenses between related corporations or branches of the same legal entity (e. g. by using transfer pricing) in order to reduce the overall tax liability of the group or corporation. PROFIT SPLIT METHOD160 -- Transfer pricing method that allocates the combined operating income or loss from a transaction among the separate parties by determining the relative value of each partys contribution to such overall profits or loss. PROFITS TAX160 -- Tax imposed on business profits in addition to ordinary income tax or as distinct from income tax imposed on other forms of income. PROGRESSION160 -- The rates of individual income tax are usually progressive, i. e. an increasing proportion of income must be paid in tax as the income increases. PROPERTY TAX160 -- Group of taxes imposed on property owned by individuals and businesses based on the assessed value of each property. PROPRIETORSHIP160 -- An unincorporated business owned by a single person. The individual proprietor has the right to all the profits from the business and also the responsibility for all its liabilities. PRO RATA160160 -- Latin for proportionally PRO RATA RULE160 -- Under most VAT systems, a credit for part of the input tax is allowed for VAT previously paid on goods and services when they are used in taxable and exempt (without credit) transactions and total transactions occurring during a calendar year. PROTOCOL160 -- Signed document containing the points on which agreement has been reached by the negotiating parties preliminary to a final treaty. For tax purposes, a protocol is signed and ratified by the parties in addition to an existing tax treaty. The protocol may be signed simultaneously with the tax treaty or later, and it clarifies, implements or modifies treaty provisions. PROVISIONAL ASSESSMENT160 -- Assessment of tax made before it is possible to make a final assessment which is often based on, for example, estimated figure or the previous years figures. PUBLICLY HELD CORPORATION --160A corporation that has a class of common stock registered on a national stock exchange a US concept. PUBLICLY TRADED LIMITED PARTNERSHIP (PTLP)160 -- Partnership in the US that is listed and traded on an established stock exchange or a secondary market. With some exceptions, PTLPs are taxed in the US as corporations rather than partnerships. PUT OPTION160 -- Contract under which the holder of the option has a right but not an obligation to sell securities or commodities, including foreign currencies, for a specified price during a specified period. - Q - QUARANTINING160 -- In the context of the foreign tax credit system, this term denotes the separate calculation of the foreign tax payable on all foreign income of a particular category which may be credited against the domestic tax payable on that category of foreign income. QUOTED SECURITIES160 -- This term denotes the securities which have been admitted to an official stock exchange and are traded therein through sale, purchase or other disposal. RAMSAY CASE160 -- The Ramsay case (W. I. Ramsay Ltd. v. IRC, Eilbeck (Inspector of Taxes) v. Rawling), decided by the UK House of Lords in 1981, involved complicated tax avoidance scheme which were marketed in the UK in the 1970s. The case established that a series of transactions with the purpose of tax avoidance, which ultimately cancelled each other out, could be ignored for tax purposes. RATES160 -- Local tax levied in Ireland and previously the UK. Rates are levied on the occupiers of real property on the basis of the annual rental value of the property. RATIFICATION160 -- The formal legislative consent or acceptance required by the constitution or domestic law of a country before a treaty to which it is a party can come into effect. REALIZATION160 -- A legal concept referring to a time when rights have become legally receivable or obligations have become legally payable.160 REALIZED GAINLOSS160 -- Actual gainloss realized from the disposal of an asset. REAL PROPERTY (REAL ESTATE)160 -- Land and everything more or less attached to it. Also referred to as 8220Realty8221. REBATE160 -- Term which in certain countries is synonymous with a tax credit. RECIPROCITY PRINCIPLE160 The principle of give-and-take operates in a variety of tax contexts (particularly in the case of tax treaties) where an exchange of tax privileges between countries is desired. Reciprocity is a basis for relieving a taxpayer under domestic law, e. g. relief is granted for foreign tax if the other country gives corresponding or equivalent relief. RECOURSE160 -- The ability of a lender to claim money from a borrower in default, in addition to the property pledged as collateral. RECOVERY OF TAX160 -- From the taxpayers point of view, this may mean a refund of tax. From the tax authorities8217 point of view, it may mean the collection of tax which is in arrears. REDEMPTION160 -- The acquisition by a corporation of its own stock in exchange for property, without regard to whether the redeemed stock is cancelled, retired, or held as treasury stock. REDUCED RATES160 -- In many countries the ordinary rates of tax charged under various tax laws may be reduced in particular situations. For example, under tax treaties, reduced withholding tax rates often apply to dividends, interest and royalties. REFUND (OF TAX)160 -- Tax repaid to a taxpayer REGISTERED SECURITY160 -- A nominative (or registered) security is a security in respect of which the owners name is recorded in a register by the issuing company and the registered owner is the person entitled to all relevant rights. REGISTRATION DUTY160 -- Fixed or variable duty levied on documents which relate to the transfer of ownership or the right to use movable or immovable property, the formation or any change of status of a company, etc. REGULATED INVESTMENT COMPANY (RIC)160 -- Company, also known as a mutual fund, formed under US law to make diversified investment with funds provided by investors who receive dividends and capital gains realized by RIC. REIMBURSEMENT160 -- The payment of an employee or another party for incurred expenses or losses. REINSURANCE160Transfer by a primary insurer to another insurer of all or part of any risk it has accepted in a contract of insurance. A number of countries have adopted special regimes to deal with cross-border reinsurance. REMUNERATION160 -- Employment income and fringe benefits received by an employee for services rendered. REPATRIATION160 -- Individuals and legal entities investing their capital in a foreign country in order to derive income from such capital may wish to transfer this capital or income back to their home country, i. e. to repatriate it. Repatriation also takes place when expatriate employees working in a foreign country want to send income to their home country. RESALE PRICE MARGIN160 -- Gross margin measured by reference to the price at which goods purchased from another party are resold to independent enterprises. RESALE PRICE METHOD160 -- Method used in transfer pricing between affiliated companies, under which an arms length price is ascertained by deducting a normal profit margin from the resale price at which a buyer of inventory assets resells these assets to an unrelated party. RESEARCH AND DEVELOPMENT (RampD)160 -- Any systematic or intensive study carried out in the manufacturing and industrial field, the results of which are to be used for the production or improvement of products and processes. RESERVES160 -- Funds made to fulfil future costs or expenditures. There are legal reserves which may be required by company law and may be necessary before dividends are distributed. RESIDENCE160 -- Residence is a basis for the imposition of taxation. Usually a resident taxpayer is taxed on a wider range of income or other taxable items than a non-resident. Residence in a state is a criteria for invoking a tax treaty of that state, and residence for treaty purposes involves considering the domestic law of residence for tax purposes, and then the requirements in Article 4 of the OECD Model, especially in the case of tiebreaker tests in cases of dual residence. RESIDENCE PRINCIPLE OF TAXATION160 -- Principle according to which residents of a country are subject to tax on their worldwide income and non-residents are only subject to tax on domestic-source income. RESIDENT160 -- A person who is liable for tax in a country or state because of domicile, residence, place of management, or other similar criterion. RESIDENT ALIEN160 -- A person is said to be a resident alien of a country if he resides in that country but is a citizen of another country. RESIDUAL ANALYSIS160 -- An analysis used in the profit split method which divides the combined profit from the controlled transactions under examination in two stages.160 In the first stage, each participant is allocated sufficient profit to provide it with a basic return appropriate for the type of transactions in which it is engaged.160 Ordinarily this basic return would be determined by reference to the market returns achieved for similar types of transactions by independent enterprises.160 Thus, the basic return would generally not account for the return that would be generated by any unique and valuable assets possessed by the participants.160 In the second stage, any residual profit (or loss) remaining after the first stage division would be allocated among the parties based on an analysis of the facts and circumstances that might indicate how this residual would have been divided between independent enterprises.160160160 RESTRICTED STOCK PLAN160 -- A stock option plan under whic h the transferred stock option is subject to restrictions regarding transferability and to substantial risk of forfeiture. Restricted stock is includable in the gross income of the employee in the first taxable year in which the rights become transferable or no longer subject to forfeiture. RETAIL SALES TAX160 -- Single-stage tax on the sale of goods to ultimate consumers, whether by retailers or other traders. RETAINED EARNINGS160 -- The portion of a corporations after-tax profits that is not distributed to the shareholders, but rather is reinvested in the business. RETROACTIVE EFFECT160 -- The effect of tax law provision towards the past, which is allowed only to the advantage of a taxpayer. RETURN160 -- Declaration of income, sales and other details made by or on behalf of the taxpayer. Forms are often provided by the tax authorities for this purpose. RETURN OF CAPITAL160 -- A distribution that is not paid out of the earnings and profits of a corporation. Rather, it is a return of the shareholders investment in the stock of the company. REVENUE NEUTRALITY160 -- Constraints on tax reform that it should not change revenues available to government in any significant way. REVENUE PROCEDURE160(REV. PROC.)160 -- An official published statement by the IRS of US about procedural and administration aspects of the tax laws. RING FENCE160 -- Theoretical enclosure established by tax legislation around certain profits, losses, transactions or groups of transactions in order to isolate them for tax purposes. ROLLOVER RELIEF160 -- Relief by means of which liability to capital gains tax is deferred. The essential feature of roll-over relief is that a gain which would otherwise have arisen on the occurrence of a taxable event for capital gains tax purposes is deferred, or rolled over, until there is a subsequent160 disposal of the asset concerned. ROUND TRIP TRANSACTION160 -- Potential transfer pricing abuse where intangible property is developed by a parent company which licenses it to a related party manufacturer located in a low-tax jurisdiction. The manufactured goods are resold to the parent for distribution to ultimate consumers. ROYALTIES160 -- Payments of any kind received as consideration for the use of, or the right to use intellectual property, such as a copyright, patent, trade mark, design or model, plan, secret formula or process. RULING160 -- Decisions or opinions of the tax authorities in respect of actual fact situations which come before it as part of an assessment procedure or in response to taxpayer questions. SAFE HARBOUR160 -- Where tax authorities give general guidelines on the interpretation of tax laws, these may state that transactions falling within a certain range will be accepted by the tax authorities without further questions. SALE AND LEASEBACK160 -- In a sale and leaseback transaction, the owner of property will sell it to a buyer who then leases it back to the original owner. This method is sometimes used to release the value of capital assets for use in a business. SALES TAX160 -- Tax imposed as a percentage of the price of goods (and sometimes services). The tax is generally paid by the buyer but the seller is responsible for collecting and remitting the tax to the tax authorities. SALVAGE VALUE160 -- Value of tangible depreciable property when it is retired from service. SCHEDULAR TAX SYSTEM160 -- Tax system in which income from different sources is taxed separately (i. e. under a different schedule) thus, separate tax assessments are made on industrial and commercial profits, wages and salaries, income from securities and shares, income from land, etc. S CORPORATION160 -- See: Small business corporation SECONDARY ADJUSTMENT160 -- An adjustment that arises from imposing tax on a secondary transaction. SECONDARY TRANSACTION160 -- A constructive transaction that some countries will assert under their domestic legislation after having proposed a primary adjustment in order to make the actual allocation of profits consistent with the primary adjustment. Secondary transactions may take the form of constructive dividends, constructive equity contributions, or constructive loans. SECOND-TIER SUBSIDIARY160 -- A taxable entity controlled by another taxable entity that is in turn controlled by a third entity. SECRET COMPARABLE160 -- A term used in the transfer pricing context. It denotes a comparable whose data is not disclosed to the public or the taxpayer but known only to the tax authority which is making the transfer pricing adjustment. SECTION 482160 -- The part of the US income tax code that gives the IRS the power to adjust distribute, apportion, or allocate gross income, deductions, credits, or allowances in order to prevent evasion of taxes or to clearly reflect income (often between controlled taxpayers) in short, US transfer pricing rule provision. SECTION 482 WHITE PAPER160 -- Study of intercompany pricing transactions made by the Office of International Tax Counsel at the US Treasury Department which presented a new methodology to govern transactions involving the sale, licensing or transfer of intangible property, published in 1988. SECURITIES160 -- Documents providing evidence of a share in the capital of a company (e. g. share certificate), or the indebtedness of some person to the holder (e. g. government or corporate bonds) or similar legal rights. SELF-ASSESSMENT160 -- System under which the taxpayer is required to declare the basis of his assessment (e. g. taxable income), to submit a calculation of the tax due and, usually, to accompany his calculation with payment of the amount he regards as due. The role of tax authorities is to check (perhaps in random cases) that the taxpayer has correctly disclosed his income. SELF-EMPLOYED160 -- Referring to persons who work for themselves and are not employed by another. The owner-operator of a sole proprietorship or a partner is considered self-employed. SENATE FINANCE COMMITTEE160 -- A committee of the US Senate that hears proposed new tax laws. SEPARATE ASSESSMENT160 -- See: Separate taxation SEPARATE TAXATION160 -- Separate taxation is a method of taxing a married couple on the basis of their joint income. It is mandatory in some countries and optional in others. Upon exercising an option for separate taxation, a husband and wife are treated as separate individuals for the purpose of computing income tax. SERVICE COMPANY160 -- Company within a multinational group of companies which generally provides support services, such as administration, sales information, post-sales service or market research, for the operating divisions of the group. SERVICE FEE160 -- A fee for the rendering of services is generally regarded as income from business activities or, in the case of a liberal profession, as income from independent personal services. SEVERANCE PAYMENTS160 -- Payment made as a result of the termination of any office or employment of a person. SHAM TRANSACTION160 -- A transaction without substance, which will be ignored for tax purposes. SHAREHOLDER ACTIVITY160 -- An activity which is performed by a member of an MNE group (usually the parent company or a regional holding company) solely because of its ownership interest in one or more other group members, i. e. in its capacity as shareholder. SHAREHOLDERS EQUITY160 -- The total assets minus total liabilities of a corporation, also called stockholders equity or net worth. SHARE (STOCK) OPTIONS FOR EMPLOYEES160 -- Some companies grant directors and employees an option to acquire at a future date shares or stock in the company at a predetermined price. It gives an employee the opportunity to benefit from the future success of the company when the market value of the shares increases over the predetermined option acquisition price. SHELL COMPANY160 -- A company set up by fraudulent operators as a front to conceal tax evasion schemes. SHIFTING OF PROFITS160 -- See: Profit shifting SHIFTING AN INCIDENCE OF TAXATION160 -- Determination of the economic entity that actually ends up paying a particular tax. In the case of indirect taxation tax is normally intended to fall upon consumption and be borne by consumers, so that entrepreneur who pays the tax on his supplies of goods and services in general passes on the tax, or shifts it forward to the consumer by adjusting his prices appropriately. Such taxes are said to be shifted backward in the case that entrepreneurs are forced to absorb some of new or increased tax. SHORT-TERM CAPITAL GAINS160 -- Capital gain derived from the disposal of assets which have been held for a comparatively short period of time. SIMULTANEOUS TAX EXAMINATION160 -- A simultaneous tax examination, as defined in Part A of the OECD Model Agreement for the Undertaking of Simultaneous Tax Examinations, means an arrangement between two or more parties to examine simultaneously and independently, each on its own territory, the tax affairs of (a) taxpayer(s) in which they have a common or related interest with a view to exchanging any relevant information which they so obtain. SINGLE ENTITY APPROACH160 -- Method of taxing a legal entity that conducts its business through a permanent establishment rather than through a subsidiary company. Under the single entity approach, a head office and a permanent establishment are treated as one taxpayer for tax purposes, even though they may be considered separate entities for purposes of accounting or commercial law. SINGLE TAXPAYER160 -- A person who is not married on the last day of the tax year. SISTER CORPORATION160 -- See: Brother-sister corporation SITUS RULE160 -- Provision of tax law setting out the factors which determine where a particular asset is situated or deemed to be situated for tax purposes. SIX MONTHS RULE160 -- See: One hundred and eighty-three (183) days rule SMALL BUSINESS CORPORATION160 -- Under US tax law, this term refers to a domestic corporation which does not have more than 35 individual shareholders, all of whom are US citizens or residents and which does not have more than one class of stock. Also known as an S corporation, this form permits income at the corporate level to be taxed only once at the shareholder level. SMALL BUSINESS RELIEF160 -- Term used to denote tax concessions which are available only to or principally to small businesses. SMALL TRADERS, SPECIAL TAX REGIME FOR160 -- In many countries small traders are subject to a special tax regime, particularly in respect of VAT, in which exemption, lower tax burden or lower administrative burden are granted. SOAK-UP TAX160 -- Tax or levy which is conditioned on the availability of a foreign tax credit in another country. SOCIAL SECURITY CONTRIBUTIONS160 -- Charges levied on employees, employers or self-employed or on all persons subject to individual income tax to cover the cost of providing future social security payments. SOLE PROPRIETORSHIP160 -- Ownership of all of the assets of an unincorporated business by a single individual. The individual owner is personally liable for all debts of the business. SOURCE OF INCOME160 -- The place (or country) where a particular item of income is deemed to originate or where it is deemed to be generated. National rules vary, depending on which concept of source is used. SOURCE PRINCIPLE OF TAXATION160 -- Principle for the taxation of international income flows according to which a country consider as taxable income those income arising within its jurisdiction regardless of the residence of the taxpayer, i. e. residents and non-residents are taxed on income derived from the country. SOURCE RULE160 -- Provision in the national law of a country or in a tax treaty which defined the concept of source for a particular type of income. SPECULATIVE GAINS160 -- Gains from the disposal of capital assets which were originally acquired with a view to selling them for more than the cost of acquisition. SPIN-OFF160 -- A type of corporate reorganization by which the shares of a new corporation (or the subsidiary company) are distributed to the original shareholders (or the parents shareholders) without these shareholders surrendering any of their stock in the original (or parent) corporation. SPLIT-OFF 160-- A type of corporate reorganization by which the shares of a new corporation (or the subsidiary company) are distributed to the original shareholders (or the parents shareholders) with these shareholders surrendering part of their stock in the original (or parent) corporation. SPLIT-UP160 -- Under a split-up the shareholders of a parent company surrender all their stock in liquidation of that company and in return receive new shares in corporation which the parent controlled or created immediately before the distribution. SPREAD160 -- Can be used in many contexts to denote the margins on financial transactions.160 For example, the spread of an option is the difference between the fair market value of stock at the exercise date and the option price. STAMP DUTIES160 -- Duty levied upon the issue of official documents such as passports, deeds, contracts for the transfer of ownership, etc. Usually, stamp duties are levied by way of a stamp being fixed to the document in question. Stamp tax STATUTE OF LIMITATIONS160 -- A statute limiting the period within which a specific legal action may be taken, such as the collection of tax, appeal from a decision of the tax authorities or lower court, etc. STOCK160 -- Any shares representing ownership in any corporation or certificates or ownership interest in any corporation. STOCK DIVIDENDS160 -- Dividend distribution by a company to its shareholders in the form of additional shares in the company. STOCK EXCHANGE TURNOVER TAX160 -- Tax levied on the sale of securities on the stock exchange market. STOCK OPTION160 -- (1). The right to purchase or sell a stock at a specified price within a stated period (2). Employee stock option STRIPPED BOND160 -- Bond or debenture from which the interest coupons have been removed and sold separately. SUBPART F160 -- Term which refers to those sections of the US tax code which provide for the taxation of US shareholders of controlled foreign corporations (CFC) in order to prevent the tax-free accumulation of earnings outside the US. SUBPOENA160 -- Latin for under penalty a writ issued under the authority of a court to compel the appearance of a witness or of documents for a tax judicial proceeding. SUBSIDIARY COMPANY160 -- Company effectively controlled by another company (i. e. the parent company). A variety of criteria, including share ownership ratio, may be employed to determine whether one company is a subsidiary of another company for tax purposes. SUBSTANCE OVER FORM DOCTRINE160 -- Doctrine which allows the tax authorities to ignore the legal form of an arrangement and to look to its actual substance in order to prevent artificial structures form being used for tax avoidance purposes. SUBSTANTIAL PRESENCE TEST160 -- Test used to determine residence status based on the number of days, months, etc. of physical presence within a country. SUPER ROYALTY PROVISION160 -- The US Income Tax Reform Act of 1986 provides that royalties for the transfer (by sale, license or otherwise) of intangible property to related foreign companies, which have been determined at the time of the transfer on an arms length basis, may be adjusted in future years by the IRS if they are not commensurate with the income attributable to that intangible. This is called the super royalty provision. SUPPLEMENTAL ASSESSMENT 160-- Determination of tax liabilities at the discretion of the tax authorities if an original assessment is incomplete or incorrect in any material respect. SURCHARGE160 -- Additional amount which is calculated on and added to the normal charge or levy. In other words, the base on which a surcharge is assessed is the normal or basic amount due. Surtax SWAP160 -- Derivative financial instrument in which two parties agree to exchange payments calculated by reference to a notional principal amount. In the classic interest rate swap agreement two parties contract to exchange interest payments based on the same amount of indebtedness of the same maturity and with the same payment dates one party provides fixed interest rate payments in return for variable rate payments from the other party and vice versa. SYNDICATE --160A group of individuals who have formed a joint venture to undertake a project that the participants would be unable or unwilling to pursue alone. TANGIBLE PROPERTY160 -- Property with a physical form, e. g. personal property, real property as distinguished from intangible property. TARIFF160 -- In general the term tariff refers to a list (schedule) or system of levies (taxes, duties, charges) imposed by countries on foreign trade transactions (especially importations). TAX160 -- The OECD working definition of a tax is a compulsory unrequited payment to the government. TAXABLE BASE160 -- The thing or amount on which the tax rate is applied, e. g. corporate income, personal income, real property. TAXABLE EVENT 160-- Term used to define an occurrence which affects the liability of a person to tax. TAXABLE PERIOD160 -- Taxes are levied by reference to a period of time called the taxable period. Tax year TAXABLE YEAR160 -- The period (usually 12 months) during which the tax liability of an individual or entity is calculated. TAX AGENT160 -- Term which refers to a tax adviser who assists the taxpayer in fulfilling his obligations under the legislation. TAX AVOIDANCE160 -- See: Avoidance TAXATION AT SOURCE160 -- See: Withholding tax TAX AUTHORITIES160 -- The body responsible for administering the tax laws of a particular country or regional or local authority. TAX BASE160 -- Taxable base TAX BASIS160 -- Term used in the US to refer to an amount that represents the taxpayers investment in an asset. TAX BILL160 -- Draft law on a tax matter which, after approval by the government of a country, is submitted to the Parliament for debate. TAX BURDEN160 -- For public finance purposes the tax burden, or tax ratio, in a country is computed by taking the total tax payments for a particular fiscal year as a fraction or percentage of the Gross National Product (GNP) or national income for that year. TAX CLEARANCE CERTIFICATE160 -- Document issued to a taxpayer by the tax authorities certifying that the taxpayer has either paid all taxes due or that he is not liable to any taxes. In certain countries a tax clearance certificate must be produced before a person can leave the country. TAX COMPLIANCE160-- Degree to which a taxpayer complies (or fails to comply) with the tax rules of his country, for example by declaring income, filing a return, and paying the tax due in a timely manner. TAX DEPOSIT CERTIFICATE 160-- Certificate available for purchase in US to taxpayers liable to income or corporate tax, etc. Liability to taxes may be paid by cashing in the deposit certificate. Interest is credited on the deposit by the Inland Revenue. TAX CREDIT160 -- See: Credit, tax TAX DECLARATION160 -- See: Return TAX EQUALITY160 -- See: Horizontal equity Vertical equity TAX EVASION160 -- See: Evasion TAX EXILE160 -- Generally speaking, a natural or legal person who severs all ties which make him fiscally resident in a particular country and moves to another jurisdiction for tax reasons. TAX EXPENDITURE160 -- This term denotes special preferences provided in income tax laws which depart from the normal tax structure and which are designed to favour a particular industry, activity or class of taxpayer. TAX FORECLOSURE 160-- The process of enforcing a lien against property for non-payment of delinquent property taxes. TAX FORM 160 -- It is usual to design special forms for taxpayers to declare their taxable income, sales, etc. for tax purposes. Forms are designed to facilitate the task of the tax authorities in assessing and collecting tax, and will usually draw the taxpayers attention to any relief he may claim, etc. as well as to his statutory duty to make accurate declarations and the penalties that may be imposed if his declaration is incomplete or false. TAX-FREE ZONE160 -- Area within the territory of a country in which customs duties and other types of indirect taxes are not applied. TAX HAVEN160 -- Tax haven in the classical sense refers to a country which imposes a low or no tax, and is used by corporations to avoid tax which otherwise would be payable in a high-tax country. According to OECD report, tax havens have the following key characteristics No or only nominal taxes Lack of effective exchange of information Lack of transparency in the operation of the legislative, legal or administrative provisions. TAX HOLIDAY 160-- Fiscal policy measure often found in developing countries. A tax holiday offers a period of exemption from income tax for new industries in order to develop or diversify domestic industries. TAX HOME160 -- A taxpayers regular place of business or post of duty, regardless of where the taxpayer a family home. TAX INFORMATION EXCHANGE AGREEMENT (TIES)160 -- Agreement which allows governments to share tax and other information with a view to combating tax evasion, drug trafficking, etc. TAX LAW, SOURCES OF160 -- The main domestic sources of tax law are primary legislation, such as acts or laws, and secondary legislation such as regulation, decisions, circulars, orders, etc. The main international sources of tax law are bilateral or multilateral treaties, and one important source for the interpretation of treaties is the OECD model tax treaty and the accompanying commentary. Another model is UN model. TAX ON TAX160 -- The charging of tax on tax-inclusive prices. TAXPAYER IDENTIFICATION NUMBER160 -- In some countries taxpayers are given an identification number which must be used when filing a tax return and assessing taxes and for all other correspondence between the taxpayer and the tax authorities. TAX PLANNING160 -- Arrangement of a persons business and or private affairs in order to minimize tax liability. TAX RELIEF160 -- Generic term to describe all methods used to reduce tax liability without regard to the particular way it is accomplished. TAX RETURN 160-- See: Return TAX SECRECY160 -- Obligation usually imposed on tax officials not to reveal particulars about the identity and personal circumstances of taxpayers, or about any of the various aspects governing their tax liability, except in certain strictly limited circumstances. TAX SHELTER160 --160 (1) An opportunity to use, quite legitimately, a relief or exemption from tax to pay less tax than one might otherwise have to pay in respect of similar activities, or the deferment of tax.160 (2) The polite term usually given to a contrived scheme to avoid or reduce a liability to taxation. TAX SPARING CREDIT160 -- Term used to denote a special form of double taxation relief in tax treaties with developing countries. Where a country grants tax incentives to encourage foreign investment and that company is a resident of another country with which a tax treaty has been concluded, the other country may give a credit against its own tax for the tax which the company would have paid if the tax had not been spared (i. e. given up) under the provisions of the tax incentives. TAX THRESHOLD160 -- Level (of income, capital, sales, etc.) at which tax commences to be levied. TAX TREATY160 -- An agreement between two (or more) countries for the avoidance of double taxation. A tax treaty may be titled a Convention, Treaty or Agreement. TAX UNIT160 -- Term used in the context of personal income tax, where taxation may be imposed by reference to separate individuals or to a group of individuals treated as one unit. TEMPORARY IMPORTATION160 -- Many countries allow temporary importation without levying customs duties and turnover tax on items which are to be within their borders for only a short time. TERRTORIALITY PRINCIPLE160 -- Term used to connote the principle of levying tax only within the territorial jurisdiction of a sovereign tax authority or country, which is adopted by some countries. Residents are not taxed on any foreign-source income. THIN CAPITALISATION160 -- A company is said to be thinly capitalised when its equity capital is small in comparison to its debt capital. THIN CORPORATION160 -- A corporation whose capital is supplied primarily by shareholder loans rather than stock investment. THREE-FACTOR APPORTIONMENT FORMULA160 -- A formula used by most US states to apportion total federal business income for out-of-state entities in order to determine the tax due a particular state. The formula equally weights the payroll factor, property factor, and sales factor. TIEA160 -- See: Tax information Exchange Agreement TIEBREAKER RULE160 -- Tax treaty provision designed to prevent an individual from being deemed resident, for purpose of the treaty, in both treaty countries. Generally a multi-step procedure will be provided to resolve the problem of dual residence, usually the place of a permanent home available being the first criterion. TORT160 -- A private and civil wrong or injury, other than breach of contract, for which a court will provide a remedy in the form of an action for damages. TRADE 160-- A business, profession, or occupation. A trade often implies a skilled handicraft, which is pursued on a continuing basis, such as carpentry. TRADE INTANGIBLE160 -- A commercial intangible other than a marketing intangible. TRADEMARK160 -- Legally registered name, word, symbol or design which identifies the goods or services of a particular manufacturer, business or company. TRADE OR BUSINESS160 -- A regular and continuous activity undertaken for a profit, other than that of an investor trading in securities. TRADITIONAL TRANSACTION METHODS160 -- The comparable uncontrolled price method, the resale price method, and the cost plus method. TRANSACTIONAL NET MARGIN METHOD160 -- A transactional profit method that examines the net profit margin relative to an appropriate base (e. g. costs, sales, assets) that a taxpayer realizes from a controlled transaction (or transactions that it is appropriate to aggregate under the principles of OECD TP guideline Chapter I). TRANSACTIONAL PROFIT METHOD160 -- A transfer pricing method that examines the profits that arise from particular controlled transactions of one or more of the associated enterprises participating in those transactions. TRANSACTION TAXES160 -- Tax that uses a specific type of transaction as its object, e. g. sales tax, immovable property transfer tax, etc. TRANSFER PRICING160 -- A transfer price is the price charged by a company for goods, services or intangible property to a subsidiary or other related company. Abusive transfer pricing occurs when income and expenses are improperly allocated for the purpose of reducing taxable income. TRANSFER PRICING ADJUSTMENT160 -- Adjustment made by the tax authorities after making a determination that a transfer price in a controlled transaction between associated enterprises is incorrect or where an allocation of profits fails to conform to the arms length principle. TRANSFER TAX160 -- Tax levied on the transfer of goods and rights, e. g. purchase andor sale of securities and immovable property. TRANSPORTATION TAX160 -- Tax levied on vehicles, ships and aircraft using public highways, rivers, and airports maintained by the government. TREATY ON EUROPEAN UNION (EU)160 -- The treaty on European Union was signed on 7 February 1992 and entered into force on 1 November 1993. This treaty creates a single economic and monetary union (EMU). The main characteristics of this union will be a single currency and a more federal political structure. By virtue of the Union Treaty, the former European Economic Community has been extended with additional goals and powers in order to become a single market in a European Union. The member states of the EU are Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden and the United Kingdom. On May 2nd 2004, Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, and Slovenia newly joined the EU. TREATY OVERRIDE160 -- Term broadly used to refer to the subsequent enactment of legislation which conflicts with prior treaty obligations. As a general rule, the provisions of a tax treaty implemented domestically prevail over other domestic legislation. However, in some countries the relations is governed by the last in time rule. TREATY SHOPPING160 -- An analysis of tax treaty provisions to structure an international transaction or operation so as to take advantage of a particular tax treaty. The term is normally applied to a situation where a person not resident of either the treaty countries establishes an entity in one of the treaty countries in order to obtain treaty benefits. TRUST160 -- A trust is a legal arrangement whereby the owner of property (i. e. settlor) transfers ownership to a person(s) (i. e. trustee) who is to hold and control the property according to the owners instructions, for the benefit of a designated person or persons (i. e. the beneficiaries). Legal title to the trust property is vested in the trustee, while equitable title belongs to the beneficiaries. TRUSTEE160 -- See: Trust TURNKEY CONTRACT160 -- Broadly, a contract to construct a complete project for example, a factory, plant or installation, from the bare site to the stage where the user only need to turn the key to put the project to immediate use. TURNOVER160 -- Volume of business of an enterprise as set forth in the profit and loss account. It is usually measured by reference to the gross receipts, or gross amounts due, from the sale of goods or services, etc. supplied by the entity. TURNOVER TAX160 -- General term used to refer to the different forms of consumption and sales taxes. UNCONTROLLED TRANSACTION160 -- Transaction between independent and unrelated enterprises. UNDER-CAPITALISATION160 -- See: Thin capitalisation UNDERLYING TAX160 -- Tax which is charged on corporate income out of which dividends are paid, but which does not appear as a direct deduction or withholding from the dividend itself. UNDERLYING TAX CREDIT160 -- See: Credit, underlying tax UNDISTRIBUTED PROFITS TAX160 -- Annual tax imposed, in addition to the normal corporate income tax, on the undistributed portion of the profits or surplus of a corporation. UNDUE HARDSHIP160 -- A substantial financial loss that would result to a taxpayer from making payment on the due date of the amount of taxes with respect to which the extension is desired. Undue hardship is a condition precedent to the granting of an extension of time to make a tax payment. UNEARNED INCOME 160-- Term used to describe investment income such as dividends, interest and royalties. UNILATERAL RELIEF160 -- Granting of relief from the effects of international double taxation on the basis of domestic legislation rather than the provisions of a tax treaty. UNIMPROVED PROPERTY160 -- Land that has received no development, construction, or site preparation (i. e. raw land). UNITARY TAX SYSTEM160 -- Under a unitary tax system, the profits of the various branches of an enterprise or the various corporations of a group are calculated as if the entire group is a unity. A formula is used to apportion the net income of the whole group to the various parts of the group. Usually a combination of property, payroll, turnover, capital invested, manufacturing costs, etc. are formula factors. UNLIMITED LIABILITY160 -- Liability of an investor which extends to the full extent of his personal assets, as in the case of a sole proprietor or general partner. UPSTREAM DIVIDEND160 -- Dividends flowing from a subsidiary company to its parent company. USEFUL LIFE160 -- Period during which it is estimated that a depreciable asset will provide useful service to the business in which it is used. USE TAX160 -- Tax on goods which are used within the taxing jurisdiction although the goods were purchased in another jurisdiction VALUATION PRINCIPLES160 -- Tax law principles regarding valuation of business and non-business assets, and inventory. VALUE ADDED TAX (VAT)160 -- Specific type of turnover tax levied at each stage in the production and distribution process. Although VAT ultimately bears on individual consumption of goods or services, liability for VAT is on the supplier of goods or services. VAT normally utilizes a system of tax credits to place the ultimate and real burden of the tax on the final consumer and to relieve the intermediaries of any final tax cost. VENTURE CAPITAL160 -- Form of capital investment for the establishment of a new business or new product development in an existing business, often in exchange for equity. VERTICAL EQUITY160 -- Doctrine which holds that differently situated taxpayers should be treated differently, i. e. taxpayers with more income andor capital should pay more tax. VIENNA CONVENTIONS160 -- There are three multilateral Vienna Conventions which are relevant for taxation purposes. Among them, the Convention of 23 May 1969 on the Law of Treaties is particularly related to the interpretation of tax and other treaties. This convention contains generally accepted rules applying to tax treaties, the conclusion of treaties, their observance, application and interpretation, etc.. There are also Vienna Conventions on Diplomatic and Consular Relations, which address taxation and other issues in that context. VOTING STOCK160 -- Shares in a corporation that entitle the shareholder to voting and proxy rights. WAGE TAX160 Tax -- levied at source as a withholding on wages taxes thus withheld are usually offset against final income tax liability (if any). WEAR AND TEAR160 -- Decline in value through the ordinary use of an asset. Income tax systems usually allow deductions in calculating the profits of a business using buildings, plant and machinery which are subject to wear and tear in the course of the business. WHITE PAPER160 -- Government document announcing government policy and practice on a specific issue or issues. WILL160 -- A legal document that serves as a key vehicle of transfer at death. WINDING UP160 -- The process of liquidating a corporation. WITHDRAWALS160 --When income or goods are withdrawn from a business by the entrepreneur to his private household (without a consideration), the income or the value of such goods normally constitutes a taxable event in the hands of the recipient for income tax purposes. Similarly, a withdrawal of goods or services for private use constitutes a taxable transaction for VAT purposes in most countries using such a system. WITHHOLDING TAX160 -- Tax on income imposed at source, i. e. a third party is charged with the task of deducting the tax from certain kinds of payments and remitting that amount to the government. Withholding taxes are found in practically all tax systems and are widely used in respect of dividends, interest, royalties and similar tax payments. The rates of withholding tax are frequently reduced by tax treaties. WORLD WIDE INCOME160 -- Criterion for the income tax liability of a resident company or individual of a certain country. In many countries a resident company or individual is subject to corporateindividual income tax on its worldwide income, subject to double taxation relief. WORKING CAPITAL160 -- Funds invested in a companys cash, accounts receivable, inventory, and other current assets (gross working capital). The term usually refers to net working capital, that is, current asset minus current liabilities. WRITTEN DOWN VALUE160 -- The value of an asset which is depreciable for income tax purposes, determined by deducting from the total cost, including installation, etc. the deduction that have been made for wear and tear or depreciation in previous tax years. - Z - ZERO COUPON BOND160 -- Long-term bond on which interest is not payable on a regular basis, but rather upon maturity of the bond. It is sold at a deep discount from its face value. ZERO RATE160 -- The term is used in relation to VAT, where the rate of tax which is in principle levied but at a rate of 0 so that in effect no tax is payable, but will result in refunds of input tax credits.
Comments
Post a Comment