The United Kingdom and Ecuador signed their first ever income tax treaty on 6 August 2024. The agreement must now be ratified by both countries before it can enter into force.
A tax treaty is a bilateral agreement between two countries to resolve issues involving double taxation of income, capital, estate, or wealth. The main goals of a tax treaty are to avoid double taxation, prevent tax evasion, and encourage cross-border trade and investment by providing tax certainty for individuals and businesses
The agreement aims to avoid double taxation on income and capital gains between the two countries. It will apply to taxes on income and capital gains imposed on behalf of Ecuador or the UK, or their political subdivisions or local authorities.
