What does the tax credit method of giving double taxation relief mean?

Tax paid in one country may be allowed as a tax credit in another country. Relief is normally restricted to the lower of the foreign or country of residency tax.

Tax paid in one country may be allowed as a tax credit in another country. Relief is normally restricted to the higher of the foreign or country of residency tax.

Tax relief is gained by deducting the foreign tax from the foreign income so that only the "net" amount will be subject to tax in the country of residency.

The countries agree on certain types of income which will be exempt or partially exempt in one country or the other.