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Regular version of the site

International Taxation and Tax Planning

2020/2021
Academic Year
ENG
Instruction in English
5
ECTS credits
Delivered at:
Практико-ориентированные магистерские программы факультета экономических наук
Course type:
Elective course
When:
1 year, 3 module

Course Syllabus

Abstract

To follow the course «International Taxation and Tax Planning» basic courses in Taxation and Corporate Finance are a recommended prerequisite. The following methods and forms of study are used in the course: ‒ Lectures; ‒ Classes (in-class case studies, work in small teams, presentations, discussion); ‒ Home reading (mostly supplementary); ‒ Self-study; ‒ Exam assignment.
Learning Objectives

Learning Objectives

  • The course provides with general glimpse on the functions, elements and principles of construction of a tax system, taxes and duties, tax planning. It helps to get acquainted more thoroughly with actual instruments, used by the holding companies in the process of tax planning. It emphasizes attention on actual international tax legislation: - Model Tax Conventions, used by the countries under conclusion of Double Tax Treaties; - Transfer pricing legislation; - Fiscal Unities; - measures, accepted in the frames of counteraction to Base Erosion and Profit Shifting (BEPS); - Controlled Foreign Companies; - Horizontal tax monitoring and tax rulings; - Order of judicial settlement of tax disputes.
Expected Learning Outcomes

Expected Learning Outcomes

  • Define and know main principles of international taxation, discuss the main trends in the development of international taxation, including BEPS measures
  • Know the difference between the different articles of the Model Tax Conventions (OECD and UN)
  • Know key techniques of preparation of transfer pricing documentations for different types of deals with tangible and intangible assets
  • Be able to apply 5 transfer pricing assessment methods
  • Know the criterions of formation of the PE
  • Know the criterions of formation of the PE of a construction site
  • Know the criterions of attribution of companies to CFC in accordance with the international and Russian practice, define a CFC in accordance with the tax legislation of the Russian Federation
  • Know main instruments of adjustment of a tax system of a company with tax authorities: tax monitoring (or horizontal tax monitoring), APA, tax ruling
  • Be able to characterize the tax advantages of a fiscal unity
  • Be able to describe the stages of the process of appeal of the decision of a tax authority
  • Be able to describe the process of regulation of the international tax disputes
  • Know how to construct legal tax optimization schemes with the use of international tax legislation
  • Solve cases on the themes of the course
Course Contents

Course Contents

  • Tax System
    Essence, Functions, Elements, Principles
  • Tax Planning
    Definition, Goals, Stages, Indication of Key Risks, Analysis of Problems and Tasks, Instruments of Tax Planning, Creation of Tax Planning Schemes
  • International Tax Planning
    Main international organizations, which form bases for the international tax planning (OECD, UN, International Fiscal Association, International Bureau of Fiscal Documentation). Main approaches to international tax consulting. Main stages of the development of tax planning in the Russian Federation. Legal base for the regulation of international tax planning
  • Principles of International Tax Planning
    Definition of tax equality. Definition of tax neutrality. Necessity of division of the concepts “tax evasion”, “tax avoidance” and “tax planning”. Tax policy. Dual nature of tax system’s tasks: financing of governmental institutions and execution of macro- and microeconomic policies
  • International Double Taxation and Methods of Its Elimination. Model Tax Conventions (US, OECD, UN). Double Tax Treaties
    Kinds of double taxation. Methods of elimination of double taxation: - unilateral (within national legislation) and – multilateral (within international tax treaties). Analysis and comparison of articles of the Model Tax Conventions (US, OECD, UN): definition of a tax resident for individuals and legal persons, evolution of a definition of the beneficial owner of the income. Separate kinds of active and passive incomes. Rules of taxation of the separate kinds of income and division of rights for taxation between the contracting States. Withholding tax. Treaty Shopping. Tax Credit. Conditional Income determination Method. Special Provisions. Non-Discrimination. Dispute resolution procedure. Information exchange on tax matters
  • Permanent Establishment
    Evolution of the definition of permanent establishment within the US, OECD, UN Model Tax Conventions. Criterions of recognition of a permanent establishment. Kinds of activity, which do not lead to a formation of the permanent establishment. Construction site, assembly and installation works as a kind of permanent establishment. Dependent agent as a form of permanent establishment. Problems, connected with the use of term “permanent establishment” in the Russian practice. Problems of assignment of the profit of the company to the activity of its permanent establishment
  • Fiscal Unity
    Within foreign and Russian tax legislation
  • Transfer Pricing. History of the Development of the Transfer Pricing Tax Legislation. Main Principles of the Transfer Pricing
    Development of the transfer pricing tax legislation. “Arm’s length principle” or market conditions within the deals between dependent parties. Definition of the market level of a price. Main documents, regulating transfer pricing rules (national legislation, OECD TP Guidelines, EU Directives). Transfer pricing methods. Sphere of application of the transfer pricing rules. Preparation of transfer pricing documentations (Russian and foreign practice). New format of preparation of transfer pricing documentation in the OECD countries and the Russian Federation (White Paper on TPD). Three-tier format of TPD. Advanced price agreements (APA’s). Modern IT programs for optimization of the process of preparation of TP documentations
  • Base Erosion and Profit Shifting – BEPS
    History of development. Implementation of BEPS measures. Initiatives in the frames of BEPS Action Plan, implemented / planned for implementation in the Russian Federation
  • CFC (controlled foreign company)
    Definition of a CFC in the international and Russian tax legislation. Provision of the reportings on CFCs. Modern IT-programs, which optimize preparation of tax reportings on CFC
  • Horizontal (Tax) Monitoring and Tax Ruling as a Form of Counteraction of Tax Payer with Tax Authority
    Conception of horizontal monitoring. Worldwide experience of development of the system of horizontal tax monitoring. Practical advantages and problems of the use of horizontal tax monitoring. Perspectives of the development of the horizontal (tax) monitoring in the EU jurisdictions, in the Russian Federation. Tax ruling as an efficient instrument of international tax planning
  • VAT
    History of development of VAT. Particularities of calculation and charge. Taxpayers and objects of taxation. VAT tax rates. VAT refund. New kind of control - Goods tracking system
  • Registration of a company in a foreign jurisdiction
    Special duties and fees (stamp duty and registration fee)
  • Regulation of tax disputes (within country and at international level)
    Pre-trial harmonization of tax disputes. Judicial harmonization. Concept of mutual tax administration
Assessment Elements

Assessment Elements

  • non-blocking Continuous assessment
    Elements of the control exceeding 30% out of the total grade can be retaken according to the rules of NRU HSE. Both cumulative and final exam marks are rounded to an integer number (0-10) according to general mathematical rules. Rounding of cumulative mark is applied only in the end of the course. Components of the cumulative mark are not rounded. None of the components of the mark is blocking.
  • non-blocking Final exam
    Elements of the control exceeding 30% out of the total grade can be retaken according to the rules of NRU HSE. Both cumulative and final exam marks are rounded to an integer number (0-10) according to general mathematical rules. Rounding of cumulative mark is applied only in the end of the course. Components of the cumulative mark are not rounded. None of the components of the mark is blocking.
  • non-blocking Individual and group homework assignments, tests on the understanding of the key regulative norms
    Elements of the control exceeding 30% out of the total grade can be retaken according to the rules of NRU HSE. Both cumulative and final exam marks are rounded to an integer number (0-10) according to general mathematical rules. Rounding of cumulative mark is applied only in the end of the course. Components of the cumulative mark are not rounded. None of the components of the mark is blocking
Interim Assessment

Interim Assessment

  • Interim assessment (3 module)
    0.36 * Continuous assessment + 0.4 * Final exam + 0.24 * Individual and group homework assignments, tests on the understanding of the key regulative norms
Bibliography

Bibliography

Recommended Core Bibliography

  • Principles of international taxation, Oats, L., Miller, A., 2017
  • VLADIMIR Panskov. (2018). Tax Benefits: Theory and Practice.

Recommended Additional Bibliography

  • Chand, V. (2018). The Interaction of Domestic Anti-Avoidance Rules with Tax Treaties - (with special considerations for the BEPS project).