What is international tax and what does an international tax accountant do?

Every sovereign nation has its own unique system of taxation. This gives rise to significant complexity when calculating the tax liabilities of organisations and individuals operating in a multi-jurisdictional environment.

International tax accountants are a specific type of accountant who specialise in International tax law (the laws that apply to the taxing of activity that takes place in two or more countries), the numerous international tax agreements (e.g. double taxation agreements that avoid an individual paying tax twice in two jurisdictions) and relevant domestic tax laws (and their effect on non-residents, or residents receiving income from foreign sources).

International tax accountants work with individuals, companies or government agencies conducting international business.

Key responsibilities

Responsibilities will vary, but examples include:

  • providing cross-border transactional and structuring advice
  • offering practical guidance to businesses that are trading and expanding internationally.
  • advising on setting up of foreign operations, including subsidiary or branch structures
  • advising on local tax exposures arising from permanent establishments
  • offering guidance on VAT and custom duty implications of cross-border services and movement of goods
  • advising on offshore trusts
  • advising on property ownership in and outside the UK
  • providing non-domicile tax advice and consultancy.

Why are they important?

The structure of international personal and company affairs has a significant impact on the tax that is paid, in particular, businesses and individuals should be careful that they are not taxed in two countries. International tax accountants design strategies to minimise the tax paid and help with claiming double tax relief. Tax penalties are also growing and compliance with an increasing number of tax rules is more important than ever.

Skills needed for this role

International tax accountants must have strong numeracy and excellent attention to detail, as well as the ability to digest complex information.

Strategic Professional Options examinations linked to this role

Advanced Taxation

Career opportunities presented by this role

These professionals are employed by large corporations, international companies, tax consultancies and accounting firms. They may also be self-employed and own their own practice or firm.

Competencies

High level competencies required by international tax specialists include:

  • Corporate and business reporting

    A. Prepares financial statements, corporate financial and integrated reports for external stakeholders using appropriate technology.

    B. Leads effective decision making through analysing, evaluating and communicating performance and position of entities.

    C. Prepares financial statements for groups of entities using appropriate technologies.

    D. Monitors, critically evaluates, and advises on the relevant accounting standards, regulations, conceptual and financial reporting frameworks.

  • Stakeholder relationship management

    A. Positively develops relationships with internal and external stakeholders.

    B. Communicates and gains commitment from internal and external stakeholder.

    C. Uses emerging technologies to collaborate and communicate effectively with stakeholders.

    D. Applies professional and ethical judgement when engaging with stakeholders.

    E. Aligns organisational strategic objectives with stakeholder needs and manages expectations.

  • Taxation

    A. Communicates knowledge of the operation and scope of the tax system, obligations of taxpayers, and the implications of non-compliance and advises on tax planning.

    B. Advises ethically on strategic tax plans and computes the tax liabilities of individuals.

    C. Advises ethically on strategic tax plans and computes the corporation tax liabilities of individual companies and groups of companies.

    D. Explains and computes the effects of value added tax (VAT) / goods and services tax (GST) and indirect tax on incorporated and unincorporated businesses and advises appropriately.