DETERMINATION OF THE SOURCE OF INCOME IN THE TAX LAW Cover Image

УТВРЂИВАЊЕ ИЗВОРА ДОХОТКА У ПОРЕСКОМ ПРАВУ
DETERMINATION OF THE SOURCE OF INCOME IN THE TAX LAW

Author(s): Dejan Popović, Gordana Ilić Popov
Subject(s): Law on Economics, Fiscal Politics / Budgeting
Published by: Правни факултет Универзитета у Београду
Keywords: Source; Active income; Passive income; Tax treaty; Permanent establishment;

Summary/Abstract: Technically, the term „source“ is used in the tax law to denominate the territory in which an objective fact, representing a chargeable event (income, capital or transaction) is located. While residence triggers off unlimited tax liability, source implies application of the territorial principle. Source rules have two distinct roles: (1) to define the boundary between the incomes of a non-resident person that is and that is not subject to domestic taxation („inbound“ role); and (2) to regulate the foreign tax credit („outbound“ role). The authors focus on the „inbound“ role of the source rules, and they point out that the most important tax policy factor which lies behind the source rules is the taxpayer’s factual and economic nexus with the given type of income. Other considerations, such as easiness of administration of the tax, also enter into the analysis.

  • Issue Year: 56/2008
  • Issue No: 2
  • Page Range: 96-120
  • Page Count: 25
  • Language: Serbian