Dual residence

Dual Residence – Dual residence occurs when an individual or entity qualifies as a tax resident in two or more countries under each country’s domestic tax laws. This situation can result in double taxation, as both countries may claim taxing rights on the same income. Dual residence issues are typically resolved through Double Taxation Agreements (DTAs), which use tie-breaker rules such as permanent home, center of vital interests, habitual abode, or nationality to determine the country of primary residence.

Example: An individual working in the UK but maintaining a home in India may be considered a resident of both countries, leading to dual residence under their respective tax laws.