Juridical double taxation

Juridical double taxation happens when the same income is taxed twice by two different countries or states under their own tax laws. This usually occurs when a person lives in one country but earns income in another, and both countries claim the right to tax that income. It increases the taxpayer’s burden and makes cross-border business more difficult.

Example: If an Indian resident earns rental income from a property in the USA, the USA taxes that income because the property is located there, and India also taxes it because the person is an Indian resident. Unless a tax treaty gives relief, the same income is taxed twice, resulting in juridical double taxation.