Our tax advisors can support companies and their employees with a variety of tax planning and compliance issues, such as cross-border issues, income tax filing for expatriates, and structuring, among other things. We can help keep your worldwide effective tax rate low and ensure your international transactions are in compliance with the IRS.
Our tax advisors excel in providing practical, proactive international tax planning for companies operating internationally. Our international tax advisors can support companies and their employees with international tax planning solutions and assist with compliance issues, such as value-added taxes and repatriation of earnings.
When companies first start operating in foreign countries, an understanding of the foreign tax laws is important to ensure that unfavorable – or unexpected – tax liabilities don’t result. Most foreign countries have value-added taxes that are paid by the importer-of-record. Negotiating – and understanding – who is the importer of record is important when first selling into a new country.
Knowing when income tax returns are required to be filed to foreign governments is another important international tax planning point. If you have a permanent establishment you will be required to file income tax returns. However, even when you do not have a requirement to file income tax returns, you may wish to file to avoid informational reporting, withholding taxes, etc. Plante Moran’s international tax advisors can help you understand – and comply with – foreign tax filing and payment requirements when you start selling or operating in foreign countries.
Companies operating overseas and making profits in overseas markets should have a strategy to repatriate their earnings in a tax-efficient manner. Though the U.S. has double tax relief agreements with most countries, the proper timing of foreign profits can still result in additional U.S. tax due to limitations on the U.S. foreign tax credit.
Distributions from low-tax jurisdictions will normally result in additional tax when distributed to the U.S., but a proper structure will allow low-taxed profits to be used in financing activities in other countries, for example. Proper planning for the repatriation of foreign profits is essential to keeping the worldwide effective tax rate low.