International Taxation of Incomes
FP-UmzpPAcad. year: 2019/2020
The course is intended to complete knowledge of tax problems in the area of income tax. The course deals with the issue of the international taxation of income. In this course students are familiarized with the problems of international double taxation and methods for its elimination. Attention is also paid to legislative regulation in the European Union.
Learning outcomes of the course unit
Students will know the rules of the international taxation of income contained in agreements on the avoidance of double taxation as well as in Czech legislation. Students at the same time will know the duties of tax subjects falling under the international taxation of income in the Czech Republic.
Students will be able to identify the duties linked to the taxation of the income of tax residents and non-residents of the Czech Republic and in simpler cases determine their resulting tax liabilities.
Students will know how to interpret and apply the basic norms of the international taxation of income in agreements on the avoidance of double taxation and in the Czech Income Tax Act. Students will know how to propose and use the instruments of tax optimisation in the international taxation of income.
Knowledge of issues in the taxation of the incomes of individuals and legal entities.
Recommended optional programme components
Recommended or required reading
Sojka, V. Mezinárodní zdanění příjmů. Smlouvy o zamezení dvojího zdanění a zákon o daních z příjmů, 2. vyd. Praha : Aspi, a. s., 2008. 326 s. ISBN 978-80-7357-354-6. (CS)
Výbor OECD pro fiskální záležitosti. Modelová smlouva o zamezení dvojího zdanění příjmů a majetku. Stručná verze. 1. vyd. Překlad Danuše Nerudová a Kristýna Šimáčková. Praha : Wolters Kluwer ČR, a. s. 431 s. ISBN 978-80-7357-480-2. (CS)
Rylová, V. Mezinárodní dvojí zdanění. 3. vyd. Olomouc : ANAG, 2009. 423 s. ISBN 978-80-7263-511-5. (CS)
Helminem, M. EU Tax Law – Direct Taxation. IBFD : Amsterdam. 406 p. ISBN 978-90-8722-058-7. (EN)
Zákon č. 586/1992 Sb., o daních z příjmů, ve znění p. p. (CS)
Zákon č. 280/2009 Sb., daňový řád, ve znění p. p. (CS)
Týč, V. Základy práva Evropské unie pro ekonomy. 6. vyd. Praha : Leges, s. r. o., 2010. 301 s. ISBN 978-80-87212-60-8. (CS)
Planned learning activities and teaching methods
The teaching is in the form of lectures which explain the basic principles and the rules contained in the relevant legislation. The interpretation is drawn from examples and assumes the assistance of students.
Assesment methods and criteria linked to learning outcomes
Examination requirements: knowledge of the material covered and its practical application.
The course ends with a written examination which is made up of two main parts:
1. Written test (test contains 15 questions with 3 possible answers (A, B, C); only one answer is correct). It is necessary to get at least 50% of the possible points (i.e. at least 8 points out of 15). The test takes 15 minutes.
- correct answer (1 point)
- no answer (0 point)
- incorrect answer (- 1 point)
2. Examples – max. 30 points (75 min.)
- solving numerical examples demonstrating familiarity with the issues and the practical ability to apply the lessons learned
- always a more complex example to determine the resulting tax liability of tax resident from receiving foreign income
- it is necessary to gain at least 50% of the possible points (i.e. 15 points out of 30)
The examination is classified according to the ECTS scale.
Language of instruction
1. International taxation of incomes - general introduction (basic terms, legal regulation, specifics within the EU area, subject operating in international taxation of incomes, tax avoidance vs tax evasion - including actual issues (BEPS))
2. Double taxation treaties (purpose, aims, model conventions, structure of the conventions, scope, conditional application of priority principle)
3. Tax residency and its determination, tax residents and taxation of their incomes (in general), tax non-residents and taxation of their incomes (in general); exchange rate conversion
4. Taxation of Czech Republic tax non-residents with the incomes having their source in the Czech Republic (duties of tax-payers, duties of payers, possibilities of tax optimization of Czech Republic tax non-residents in comparison with Czech Republic tax residents)
5. Rules as stated in double taxation treaties for income from immovable property, capital gains and incomes from employment.
6. Rules as stated in double taxation treaties for directors’ fees, entertainers and sportspersons and pensioners.
7. Rules as stated in double taxation treaties for permanent establishment.
8. Rules as stated in double taxation treaties for so-called passive incomes (dividends, interest and royalties).
9. Taxation of income of tax residents - methods for elimination of double taxation (principles, description, para. 38f of Act on Income Tax, methods in double tax treaties).
10. Taxation of incomes of tax residents - application of the methods for elimination of double taxation, tax optimization in the case of tax residents.
The main objective of the course is not only to provide students with the theoretical fundamentals of the issues of the international taxation of income, but also the ability to apply practically the knowledge gained. This requires knowledge of the principles of international taxation of income and also the specific rules contained in agreements on double taxation, as well as the relevant Czech legislation.
Specification of controlled education, way of implementation and compensation for absences
The participation at lectures is not obligatory.