Question 1: What is tax residency and why is it important in international taxation?
Answer: Tax residency determines the country in which an individual or business is liable to
pay taxes on their worldwide income. It is crucial in international taxation as different
countries have varying rules to define tax residency, leading to potential double taxation
Question 2: What is the difference between a tax exemption and a tax deduction?
Answer: A tax exemption excludes certain income, investments, or entities from taxation
altogether. A tax deduction, on the other hand, reduces the taxable income of an individual or
business, thereby lowering the amount of income subject to taxation.
Question 3: How do tax incentives for charitable donations work?
Answer: Tax incentives for charitable donations encourage individuals and businesses to
contribute to qualified charitable organizations. Donors can deduct the donated amount from
their taxable income, reducing their overall tax liability and promoting philanthropy.
Question 4: What is a property tax assessment and how is it determined?
Answer: A property tax assessment is the process of determining the value of a property for
tax purposes. Assessments are typically conducted by local government authorities and are
based on factors such as property size, location, improvements, and market value.
Question 5: What are tax implications for cryptocurrency transactions?
Answer: Cryptocurrency transactions are subject to taxation in many countries. Tax
treatment varies, but generally, cryptocurrencies are considered either property or a
commodity, and transactions may incur capital gains tax. Proper record-keeping and
reporting are essential for compliance.