What are the tax considerations for a U.S. business expanding into foreign markets?

When a U.S. business expands into foreign markets, the tax decisions made at the outset of that expansion have long-lasting consequences that are far more difficult and costly to reverse than to get right the first time. Key considerations include the choice of foreign business structure (branch, subsidiary, joint venture, or other form), the tax treaties between the U.S. and the target country and how they affect withholding taxes and income sourcing, transfer pricing requirements for intercompany transactions, foreign tax credit planning to minimize double taxation, GILTI (Global Intangible Low-Taxed Income) implications for controlled foreign corporations, and repatriation planning for profits earned abroad. Yeo & Yeo’s international tax specialists work with businesses at the planning stage of international expansion to structure their foreign operations in the most tax-efficient manner available — before commitments are made that are difficult to unwind.