Cross-border taxation
In an international world it becomes more common that people have assets or income from different countries.
In most countries you become tax liable of your global income if you are a resident and domiciled in this country. However, some country allows you to be resident but not domiciled which – with differenties – allows you not to be globally taxed but only suffer domestic taxation in the country of residence.
Regardless of your residency income located in one state will often be taxed there. If you own a business entity, a company, stocks, you receive dividends, you own property or you have any other kind on income, the country or source will most likely also tax this.
Being tax liable of your global income in one country but also limited tax liable (on domestic income) in another country includes a risk of being taxed twice on the same income. This is off course not appropriate or wanted by anyone.
Denmark and most other OECD countries have numerous and (mainly) bilateral agreements/treaties to avoid double taxation, the DTAs. The DTA distributes the right to tax given by the contracting countries individual tax legislation. You may always use the DTAs or the legislation to secure and optimize.
At PrivatRevision we have comprehensive experience working with DTAs and Danish taxation. Please contact us and let us help if you have cross-border income – living in Denmark or sourced in Denmark.