foreign income taxation

Foreign income taxation refers to the rules that determine how a country's government taxes money earned outside its borders. Many countries tax their residents or citizens on worldwide income, meaning earnings from foreign jobs, investments, or businesses are included in their taxable income. To avoid double taxation, countries often have agreements called treaties that provide credits or exemptions. Essentially, individuals and businesses need to report foreign income to their home country and may be able to offset foreign taxes paid. The goal is to ensure fair taxation without unfairly penalizing income earned abroad.