DOING BUSINESS IN HONG KONG

Posted By Romain Ponsot on Oct 6, 1907 in Doing Business


Date de publication : 06-10-1907

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The following information are for the sole purpose  of providing a general overview of  the local taxation of the Corporate tax aspects of the country. In any case, it can not replace a tax advice, or be considered as an official information.

 

Yes we tax in Hong Kong

 

Flash News

New tax reform: No specific information

New tax treaties:

  • Tax treaty between Hong Kong and Belarus is gazetted by Hong Kong (and ratified by Belarus).
  • Tax treaty between Hong Kong and Latvia is gazetted by Hong Kong.
  • Tax treaty between Hong Kong and Pakistan is gazetted by Hong Kong.
  • Tax treaty between Hong Kong and New Zealand is signed.
  • Tax treaty between Hong Kong and Cambodia is under negotiation.
  • Tax treaty between Hong Kong and Australia is under negotiation.

Local tax advisors

No specific information on the local tax advisors.

Local tax administration

Website Tax administration: Click here

Permanent Establishment

Entities are considered to be resident for tax purposes in Hong Kong if their place of management & control is in Hong Kong.

However, the place of residence is subject to the relevant provisions of any applicable double tax treaty, if any.

Corporate Income Tax

The general CIT tax rate is 16.5%.

Non-taxable income includes the following:

  • Dividends (participation exemption)
  • Certain capital gains

Non-deductible expenses includes the following:

  • Dividends benefiting from the participation exemption

Carry forward: yes indefinitely, but some restrictions may apply

Carry back: No

No specific information on assessment, filing of tax returns and payments.

Whithholding Taxes (payment to foreign companies)

The local tax rates in Hong Kong are the following, subject to the provisions of an applicable double tax treaty, if any.

There is no WHT on the profits paid from a branch to its foreign head office

In general there is no WHT on dividends.

In general there is no WHT on interest.

The effective WHT rate on Royalties is 4.95%.

In general there is no WHT on management fees.

In general there is no WHT on technical services.

Capital gains

Generally capital gains on sale of shares in resident companies are not taxed.

VAT - No

Not applicable

Not applicable

Not applicable

Miscellaneous

The general statute of limitation is 6 years starting at the end of the year in which the tax return had to be filed.

The statute of limitation is extended to 10 years for negligent tax fraud and for wilful tax fraud.

There is no foreign exchange control in Hong Kong.

There are no thin capitalization rules in Hong Kong.

 

 

 

Do not hesitate to share your experience in Hong Kong with us in the comments below. Any comments are welcome !

 

Romain Ponsot

Romain est conseiller en fiscalité au sein d’un leader mondial du shipping. Grâce à son expertise tant en matière de TVA, fiscalité internationale, problématiques intragroupe qu’en matière de fiscalité des particuliers, Romain vous guidera au travers d’articles professionnels et humoristiques. 

Romain, poète dans l’âme, aime particulièrement le couscous et passe beaucoup de temps à glacer ses souliers. Profil LinkedIn
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