Here is a summary of the topic: The text discusses various international tax planning strategies that companies can use to reduce their tax liability. These include: 1\. Tax Treaty Shopping: Using provisions in tax treaties between two countries to lower taxes. 2\. Transfer Pricing: Manipulating transfer prices for transactions between related companies in different countries to shift profits to lower-tax jurisdictions. 3\. Deferral of Taxes on Foreign Income: Delaying payment of taxes on income earned in a foreign country until it is repatriated to the home country. 4\. Use of Offshore Companies: Setting up a company in a low-tax jurisdiction to conduct business activities and avoid high taxes in other countries. 5\. Cross-Border Inversions: Acquiring a company in a low-tax jurisdiction and moving the headquarters of the combined entity to that jurisdiction to reduce tax liability in the home country.

Sure, here are some examples of international tax planning strategies:

International Tax Planning Strategies

1. Tax Treaty Shopping

Tax treaty shopping involves using the provisions of a tax treaty between two countries to reduce taxes. For example, if a company is based in the United States and wants to invest in Germany, it can use the US-Germany tax treaty to reduce its tax liability. The company can structure its investment in such a way that it benefits from the lower tax rate provided by the treaty.

2. Transfer Pricing

Transfer pricing refers to the process of setting prices for transactions between related companies in different countries. By manipulating transfer prices, companies can shift profits to lower-tax jurisdictions. For example, a company may set a low transfer price for goods sold by its subsidiary in a high-tax country to its parent company in a low-tax country, thereby reducing taxes in the high-tax country.

3. Deferral of Taxes on Foreign Income

Deferral of taxes on foreign income involves delaying the payment of taxes on income earned in a foreign country until it is repatriated to the home country. This strategy is often used by multinational corporations that earn income in multiple countries but do not immediately bring that income back to their home country due to differences in tax rates.

4. Use of Offshore Companies

Using offshore companies involves setting up a company in a low-tax jurisdiction to conduct business activities. This strategy is often used to avoid taxes in high-tax countries. For example, a company may set up an offshore company to conduct sales activities, and then use transfer pricing to shift profits to the offshore company, thereby reducing taxes in the high-tax country.

5. Cross-Border Inversions

Cross-border inversions involve acquiring a company in a low-tax jurisdiction and then moving the headquarters of the combined entity to that jurisdiction. This strategy is often used by companies looking to reduce their tax liability in their home country. For example, a US-based company may acquire a company in Ireland and then move its headquarters to Ireland, where corporate taxes are lower than in the US.