Double taxation occurs when two countries both claim the right to tax the same income. This affects remote workers living in one country while employed by a company in another, and expats receiving home-country income.

Most developed nations have bilateral Double Taxation Agreements (DTAs) that determine which country has primary taxing rights and provide credit mechanisms to prevent full double taxation. Without a DTA, income may be legally taxed twice.

Key example: a US citizen remote-working from Portugal is subject to both US worldwide taxation and Portuguese IRS — the US-Portugal DTA provides partial relief.