Center for Taxation and Public Governance

· Taxation of SME’s and MNO’s

· Commercial vs. tax accounting

· Corporate tax systems

· International profit allocation

· Tax treaties

Topics:

Price: € 4,000

A competitive system of business taxation is important to attract foreign direct investment. This course focuses on business taxation in general and on corporate income taxation in particular. Most countries differ in their taxation of business profits between a personal business and legal entities (corporate bodies). Profits of small businesses are often taxed only at the level of the entrepreneur, normally with a personal income tax at the regular (mostly progressive) tax rates. When a business grows, the entrepreneur will often change the legal form of the business and transforms it into a corporation. This corporation is then subject to corporate income tax, often a proportionate tax rate. In addition to this corporate income tax, profit distributions (dividends) are taxed at the level of shareholders (the ex-entrepreneur).

 

Taxation of business profits of small enterprises in quite simple. The personal income tax is often the only tax levied. Important issues are the determination of the taxable profit and the distinction of business income from the personal sphere of the entrepreneur. Another important issue is the determination of taxable base versus profit from commercial financial statements.

Corporate income tax systems are more complex, because they relate to the personal income tax of the shareholder. A tax system has to choose in what way the corporate income tax integrates with the personal income tax. Different systems will be discussed. In addition, the tax treatment of dividend distributions to company shareholders and private shareholders (individuals) and their international implications are a main issue to be discussed.

 

Finally the course focuses on the international aspects: bilateral tax treaties which aim at avoiding double taxation of business profits in cross-border situations. The conditions to determine the existentce of a permanent establishment of a foreign company and the international profit allocation are of main concern for the possibility to levy corporate income tax in participant’s country. In this part attention is also paid to developments within the European Union to achieve a harmonized corporate income tax system through directives and case law.

Prof. Dr. Geerten Michielse

Our address:

T: +31 (0)20 638 0136

F: +31 (0)20 421-8730

M: +31 (0)6 3018 3025

E: geerten@michielse.com

Comparative Income Tax Systems