Residence Tiebreaker Essay Example | Topics and Well Written Essays - 2000 words

Residence Tiebreaker - Essay Example This may lead to a double taxation system. The above necessitates for the individual to utilize the relevant treaties available in determining residency.1 Fortunately, many nations in the world have come together in development of international laws that will safeguard such individuals from such huge tax burdens. There are conditions that an individual should fulfill to be considered a taxpayer of country X instead of country Y. These conditions are referred to as the tiebreaker rules. Different countries use different criteria in carrying out assessments to determine the residence of an individual. There are instances where a person can be considered as a taxpayer in two different countries. The law provides for dual citizenship. In such a case, the individual can pay tax twice under specified laws of the two countries. In most countries, the residence factor is addressed in Article 4.2 They all address it as the Residence Article. In a case where the two countries have a treaty in respect to tie-breaking rules, the two countries can settle their claims on which country has the right to tax the individual. In many cases, these provisions are highlighted in paragraph 2 of Article four of the law. The international law provides the treaty with supreme powers over the domestic laws in determining the residence of the person.