Information about Taxes and Legal Agreements

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Two issues that expats should get familiar with are taxes and the law concerning legal treaties. Being familiar with these agreements can serve you in good stead wherever you are.

What are Tax Information Exchange Agreements?

Also known as TIEA, this is a contract agreed upon by two countries concerning tax data sharing. Usually, these agreements concern company or trust beneficial ownership data. The nation that needs the information will make a formal request by the proper authority.

The subject being looked into has to be included in the jurisdiction that is requesting. Before any data exchange can be made, the country asking for the information must have exhausted all available resources prior to making the request. All the information that is gathered in the investigation is kept confidential.

Use

The TIEA agreements are utilized by nations with worldwide taxation. They use it to collect data from nations with territorial tax systems. The IRS utilizes the TIEA to go around bank privacy laws.

Their purpose is to gather information on people they believe should be paying taxes. Nations that have the TIEA agreement with America include the Cayman Islands, the Bahamas, the British Virgin Islands, Aruba, Panama, Antigua and Barbuda.

What are Mutual Legal Assistance Treaties?

Also known as MLATs, this is an agreement between two nations that allows them to share and collect information. The purpose is to enforce criminal laws.

There are several aspects of this agreement. One of the most notable aspects is that it can be used to evaluate people, places and other subjects. The treaty is also designed to paralyze devices used by criminal syndicates. When necessary, the treaty can be used for assessing possible custodial transfers.

Essence of the Agreement

In short, the treaty is meant for collecting data for investigation. If there is a need, it can also be used for prosecution. Both public and private sources can be used for legal procedures. The nations that partake of the treaty agree on several provisions.

Both countries will have access to witnesses and documents. They will also provide legal and judicial aid when necessary. The first US MLAT was made with Switzerland in 1977. Since that time, America has signed similar treaties with other nations including France, Canada and the UK.

After the treaty is made, a central authority will be designated to handle communications. When the treaty is enforced, search warrants can be issued and witnesses summoned.

News – Kamal Khetan is a chairman and managing director of Sunteck Realty and he is India’s richest Top 10 men onForbes.

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