Double Taxation Agreement

A Double Taxation Agreement (DTA) is a treaty between two countries that prevents individuals or companies from being taxed twice on the same income. It clarifies how income earned across borders—like salaries, business profits, or investments—should be taxed, ensuring fair sharing of taxing rights. The goal is to avoid double taxation, which could unfairly burden taxpayers, and to promote international trade and investment. DTAs typically specify which country has the primary right to tax certain types of income and may also provide mechanisms for taxpayers to claim relief or credits for taxes paid abroad.