Worldwide or territorial approach for individual income tax : which is more prevalent?

Connie SHUM, Jack FAY, Man Ching, Gladie LUI

Research output: Journal PublicationsJournal Article (refereed)peer-review


For individuals who are contemplating relocating, how their income will be taxed might be an important factor when deciding whether or not to take up residence in another country. Two income approaches are commonly used around the globe. Worldwide income approach (also known as a global tax system) taxes income from whatever source derived. Territorial income approach taxes only income earned within the country’s borders. Using information collected from PricewaterhouseCoopers’ website1 that provides information on tax systems used in countries around the world, this paper examines which countries apply worldwide or global income approach and which employ territorial approach to determine the legitimate source of taxable income. The research focuses on countries within: (1) Americas; (2) Asia/Pacific Basin; (3) Europe; and (4) Africa/Middle and Near East. Based on the information collected and presented in this paper, the worldwide approach is much more prevalent (104 countries) than the territorial approach (30 countries). This paper also investigates any specific rules that a particular country has in relation to income to be taxed and residency versus non-residency status of the taxpayers. There appears to be an abundant spectrum of rules relating to residency and domicile for tax purposes among the countries.
Original languageEnglish
Pages (from-to)137-151
Number of pages15
JournalJournal of Modern Accounting and Auditing
Issue number4
Publication statusPublished - Apr 2017


  • global individual income tax
  • individual income tax
  • worldwide/territorial income approach


Dive into the research topics of 'Worldwide or territorial approach for individual income tax : which is more prevalent?'. Together they form a unique fingerprint.

Cite this