What is double taxation convention in SAP PY - Payroll?

SAP Term: double taxation convention

• Component: PY

• Component Name: Payroll

• Description: An international agreement between two or more states. The purpose of double taxation conventions is to prevent people who work abroad and who must pay tax on their earnings from having to pay taxes more than once in other words, in more than one country for the same period and for the same taxable income. They are generally based on the tax laws of the state in which the work is performed. Double taxation conventions are particularly important for people in regions near to international borders cross-border employees.

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• Key Concepts: 
  Double taxation convention is a term used in SAP Payroll (PY) to refer to the process of avoiding double taxation of income. This is done by allowing a taxpayer to claim a tax credit for taxes paid in one country against taxes due in another country. This helps to ensure that the same income is not taxed twice. 
  
  How to use it: 
  In SAP Payroll, double taxation conventions are used to ensure that employees are not taxed twice on the same income. This is done by allowing the employee to claim a tax credit for taxes paid in one country against taxes due in another country. This helps to ensure that the same income is not taxed twice. 
  
  Tips & Tricks: 
  When setting up double taxation conventions in SAP Payroll, it is important to ensure that all relevant information is included. This includes the countries involved, the applicable tax rates, and any other relevant information. Additionally, it is important to ensure that all relevant tax laws are taken into account when setting up double taxation conventions. 
  
  Related Information: 
  For more information on double taxation conventions and how they are used in SAP Payroll, please refer to the official SAP documentation. Additionally, there are many online resources available which provide further information on this topic.