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International Tax Filing


International taxation is the study or determination of tax on a person or business subject to the tax laws of different countries. The administering body in the United States is Internal Revenue Services (IRS). Income tax returns are filed with IRS or with state or local tax. Returns are prepared by using forms prescribed by IRS or other authorities. Self-employed is a person who either:

  • Carries out a trade or business as a sole proprietor or an independent contractor.
  • Any business including a part-time business.
  • Member of a collaboration that carries on a trade or business.

Business structure
When starting the business, it needs to be decided which form of business entity should be created. Our business form will determine what will be our taxation structure. The most common forms of business are the sole proprietorship, partnership, corporation, and S corporation.

Obligations under self-employment
A self-employed individual is required to file an annual return and has to pay estimated taxes quarterly. Self-employed individuals have to pay self-employment taxes as well as income tax. S.E. tax is a social security and medicare tax specifically for those individuals who are self-employed.

Filing annual tax returns
To file an Income tax return, we use schedule C to report profit or loss from businesses or professions operated as self-employed. The income tax return must be filed if net earnings from self-employment are $400 or more; if net earnings are less than $400, the income tax return will still be filed if it is prescribed to do so in some cases. The financial year for self-employed individuals is the calendar year, beginning from 1st January and ending 31st December. For example, the last date for individuals operating as a sole proprietor is 15th March, and for individuals working as an S corporation and partnership, the later date is 15th April.

Filing social security and medicare taxes
Social security and medicare taxes are filed in Schedule S.E. (Form1040 or 1949 S.R.), self-employment tax. To calculate S.E. tax, schedule C will be taken into consideration. 

The filing estimated quarterly tax payments
Estimated tax is a method to pay social security, medicare tax, and income tax at quarterly intervals. These are filed in form 1040-ES, estimated tax for individuals. Previous year Annual return will be needed to file 1040-ES. Form 1040-ES contains blank vouchers used to make estimated tax payments, or payment can be made by using the Electronic Federal Tax Payment System (EFTPS). Individuals, including sole proprietors, partners, and S corporation shareowners, have to make estimated tax payments if they look forward to owing tax of $1,000 or more in their current financial year. Corporations normally have to make estimated tax payments if they expect to owe a tax of $500 or more in their current financial year: form 1120-W, Form 1120-W, estimated tax for corporations. 

Exemption from filing quarterly tax payment
Quarterly tax payment needs not to be done if:

  • There is no tax liability for the prior year
  • You were a U.S. citizen or resident for the whole year
  • Your prior tax year covered 12 months
  • If you acquire salaries and wages, you can avoid paying the estimated tax by interrogating your employer to withhold more tax from your income. For this file, a new Form W-4 with your employer. There is a unique line on form W-4 for you to enter the additional amount you want your employer to withhold.

When to pay estimated taxes
For tax payment purposes, the year is divided into four parts
Due dates are:

  • 15th April
  • 15th June
  • 15th September
  • 18th January

If a return for a particular financial year is filed until 31st January of the succeeding financial year, then the last instalment due on 18th January should not be considered.

Contemporary reflections for international taxation require smooth administration and revenue sufficiency. Developing nations such as India must examine social justice factors as well in designing International taxation structures. Main standards of taxation like equity, clarity, economy of a particular country must be taken into account while developing international taxation.

At AJSH, we assist you with your company’s international tax filings. We offer leading-edge tax consultancy services, delivering tangible benefits to our clients. Our tax professionals are experienced at handling all of the specific business and tax issues you currently face, as well as future challenges. In addition, our expert consultants will help you comply fully with all your company tax requirements. Our tax experts analyze and remediate the impact of your company reporting obligations on your global tax footprint. Further, we have assisted our clients based in the U.S., UK, Canada, Australia, and Singapore on an hourly, fixed fee or retainer basis. If you have any questions or wish to know more about International tax filing, kindly contact us.


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