A Company Is a Legal Entity but Not a Citizen. Is This Statement True

Subsequent expert opinions interpreted these pre-argumentative comments as part of the legal decision. [26] Accordingly, under the First Amendment, Congress cannot enact any law restricting the freedom of expression of a company or political action group or requiring reporting on a local newspaper,[27] and under the due process clause, a state government cannot take possession of a company without due process and without providing fair compensation. These guarantees apply to all legal entities, not just companies. SAFE HAVEN — When tax authorities provide general guidance on the interpretation of tax laws, they may declare that transactions within a certain range will be accepted by tax authorities without further questions. SALE AND SALE-LEASEBACK – In a sale-leaseback transaction, the owner of the property sells it to a buyer, who then leases it to the original owner. This method is sometimes used to release the value of fixed assets to be used in a business. SALES TAX — Tax levied as a percentage of the price of goods (and sometimes services). The tax is usually paid by the buyer, but the seller is responsible for collecting and transferring the tax to the tax authorities. RESCUE VALUE — The value of tangible assets that can be depreciated when they are taken out of service.

SCHEDULAR TAX SYSTEM — A tax system in which income from different sources is taxed separately (i.e., according to a different «scale»); Thus, separate tax notices are issued for industrial and commercial profits, wages and salaries, income from securities and shares, income from real estate, etc. Fact. S CORPORATION — See: SECONDARY ADJUSTMENT OF SMALL COMPANIES — Adjustment resulting from the levying of taxes on a secondary transaction. SECONDARY TRANSACTION — A constructive transaction that some countries will assert under their national laws after proposing a primary adjustment to align the actual allocation of profits with the primary adjustment. Secondary transactions can take the form of constructive dividends, constructive equity contributions or constructive loans. SECOND-LEVEL SUBSIDIARY — A taxable entity controlled by another taxable entity, which in turn is controlled by a third-party entity. SECRETLY COMPARABLE – A term used in transfer pricing. This is a comparable person whose data is not disclosed to the public or the taxpayer, but is known only to the transfer pricing adjusting tax authority. SECTION 482 – The part of the U.S. Income Tax Act that gives the IRS the power to distribute, divide, or apportion gross income, deductions, credits, or deductions to prevent tax evasion or clearly reflect income (often among controlled taxpayers); In short, the U.S. transfer pricing rule.

SECTION 482 WHITE PAPER — Study by the Office of the International Tax Counsel of the United States Department of the Treasury that Introduced a New Methodology for Regulating Transactions Related to the Sale, Licensing, or Transfer of Intangibles, published in 1988. SECURITIES – Documents containing a share in the capital of a company (e.g., share certificate) or a person`s indebtedness to the holder (e.g., government or corporate bonds) or similar legal rights. SELF-ASSESSMENT — A system by which the taxpayer is required to indicate the basis of his contribution (for example, taxable income), to provide a calculation of the tax due and generally to accompany his calculation with the payment of the amount he considers due. The role of the tax authorities is to verify (possibly in random cases) that the taxpayer has correctly disclosed his income. SELF-EMPLOYED — Refers to persons who work for themselves and who are not employed by another. The owner-operator of a sole proprietorship or a shareholder is considered to be self-employed. SENATE FINANCE COMMITTEE — A committee of the U.S. Senate that hears proposed new tax laws. SEPARATE ASSESSMENT — See: Separate taxation SEPARATE TAXATION — Separate taxation is a method of taxing a married couple on the basis of their common income. It is mandatory in some countries and optional in others.

When exercising a separate taxation option, husband and wife are treated as separate natural persons for the purposes of calculating income tax. SERVICE COMPANY – a company within a multinational group of companies that typically provides support services such as administration, business information, after-sales service or market research to the group`s business areas. SERVICE FEES — Service fees are generally considered to be income from a commercial activity or, in the case of a liberal profession, income from independent personal services. SEVERANCE PAY – Payment made following the termination of an office or employment of a person. FICTITIOUS TRANSACTION – A transaction without substance that is ignored for tax purposes. SHAREHOLDER ACTIVITY — Activity carried out by a member of a multinational group of companies (usually the parent company or a regional holding company) solely on the basis of his or her participation in one or more other members of the group, i.e. in his or her capacity as a shareholder. SHAREHOLDERS` CAPITAL – Total assets minus a company`s total liabilities, also known as equity or net assets. EMPLOYEE STOCK OPTIONS – Some companies grant directors and employees the opportunity to purchase shares or shares of the company at a predetermined price at a later date.

It gives an employee the opportunity to benefit from the future success of the business if the market value of the shares exceeds the predetermined option purchase price. SHELL COMPANY — A company created by fraudulent operators as a camouflage to hide tax evasion schemes. PROFIT SHIFTING — See: Profit shiftING A TAX INCIDENCE — Determination of the economic unit that actually pays a particular tax. In the case of indirect taxes, the tax is normally intended to fall on consumption and to be borne by consumers, so that the trader who pays the tax on his supplies of goods and services in general waives the tax or `passes it on` to the consumer by adjusting his prices appropriately. These taxes must be moved «backwards» if entrepreneurs are forced to absorb some of the new or increased taxes. SHORT-TERM CAPITAL GAINS — Capital gains from the sale of assets held for a relatively short period of time. SISTER SOCIETY — See: Brother-Sister-Society SITUS RULE — Determination of tax law that specifies the factors that determine where a particular asset is located or is considered tax-based. SIX-MONTH RULE — See: One hundred and eighty-three (183) day small business corporation rule — Under U.S. tax law, this term refers to a national corporation that has no more than 35 individual shareholders, all of whom are U.S. citizens or residents, and that has no more than one class of shares. This form, also known as the «S-Corporation», allows income to be taxed at the corporate level only once at the shareholder level. SMALL BUSINESS RELIEF – A term used to refer to tax relief available only or primarily to small businesses.

SMALL TRADERS, SPECIAL TAX REGIME FOR — In many countries, small traders are subject to a special tax regime, particularly with regard to VAT, in which an exemption, a lower tax burden or a lower administrative burden is granted. SOAK-UP TAX — A tax or levy that depends on the availability of a foreign tax credit in another country. SOCIAL SECURITY CONTRIBUTIONS – Levies levied on employees, employers or the self-employed, or on any person subject to personal income tax, to cover the cost of future social security contributions. SOLE PROPRIETORSHIP – Ownership of all assets of an unregistered corporation by a single person. The individual owner is personally responsible for all debts of the company. SOURCE OF INCOME — The place (or country) where a particular item of income is expected to originate or is considered earned.