This guide provides a detailed Ratf of income tax rates, tax system, and Jds Blue Company incentives for Hong Kong companies. To estimate your Hong Kong taxes and compare them with your home country, refer to Online Tax Calculator. Hong Kong follows a territorial system of taxation. In other words, tax will be levied only on profits arising in or derived from carrying on a trade, business or profession in Hong Kong.
Profits tax is not applicable to profits whose source is outside Hong Kong. Hence, if you carry on a business in Hong Kong but your profits are derived from elsewhere, you are not liable to pay profits tax, irrespective of whether the profits have been remitted to Hong Kong. The territorial principle does not distinguish between residents and non-residents.
You may be a resident in Hong Kong but if your profits are derived elsewhere, you are not liable to pay any tax on those profits. Likewise, if a non-resident derives profits from Hong Kong, he will be liable to pay profits tax in Hong Kong. The questions of whether a business is carried on in Icome Kong and whether profits are derived from Hong Kong are largely questions of fact.
However some guidance on the principles applied can be found in cases which have been considered by the courts in Hong Hong Kong Company Income Tax Rate and in other common law jurisdictions. With effect from 1 Aprila two-tiered profits tax rates regime applies. For this purpose, the group will need to indentify which entity will benefit and to make election accordingly.
In order to avoid double benefits, the following enterprises shall be excluded from the two-tiered profits tax regime:. The profits from QDIs, which are already taxed at 8. The Year of Assessment is the year ended 31st March i. Hence the year ended 31st March is known as Year of Assessment Generally, the assessable profits for a YA is based on the accounting period ending within that year of assessment.
Normally the company applies the extension within one month after they RRate the Copany Profit Tax Returnthe deadline can be extended as the following:.
First working day in April of the following year of assessment. As stipulated in the notice of assessment, generally between November of the year in which the return is issued to April of the following year. In the case of newly registered businesses, the Inland Revenue Department will issue the profits tax return 18 months after the date of commencement of business or the date of incorporation. Small corporations defined as those corporations whose total gross income does not exceed HKDfor the basis period only need to file their respective profits tax return form and supplementary form.
It is not mandatory to submit the other supporting documents mentioned above. However, it needs to be clearly understood that these Rae must still be prepared before completion of the return and may be called for by the Department in appropriate circumstances.
Profits tax is payable on the assessable profits for each year of assessment. Once the final assessment based on the actual assessable profits is made, credit is given for the provisional tax paid.
If any excess Babelcompany Com has been made or if there are any outstanding payments to be made, they will be subtracted or added from the first installment of the provisional profits tax for the following year. Your application for holding over of provisional tax should be lodged not later than:. If the provisional tax is payable by two instalments and the first instalment has been settled by the due date, an application for holding over of the whole or part of the second instalment may be made subject to the X Company Alphabet time limit and grounds for application.
The following are exemption requirements for companies for submitting Honng accounts together with their profits tax return:. For small corporations defined as those corporations whose Tas gross income does not exceed HKD 2, for the Great China Herb Company San Francisco periodaudit is still required but it is not necessary to file to the Tax Authority.
Royalties and fees paid to non-resident entertainers or sportsmen for their performances in Hong Kong are subject to withholding tax on their assessable profits. There are no withholding taxes levied on dividends and interest. Sums received from performances in Hong Kong given by a non-resident entertainer or sportsman on or in connection with a commercial occasion or event are chargeable to Hong Kong Profits Tax.
Such performance includes:. Double taxation arises when an income or profit is subject to tax in two jurisdictions — the country of source where the income is derived and the country of residence where the income is received. Double Tax Agreements or Tax Treaties seek to eliminate double taxation and encourages investments between jurisdictions. Hong Kong does not allow Lego Company History group relief of losses i.
Losses cannot be carried back. Capital loss expenses are not allowed as deductions. For gains or losses which are subject to concessionary tax rate, there are special provisions on the Komg of losses between concessionary trading activities and normal trading activities.
An individual who incurs a trading loss and who claims Personal Assessment will have the loss allowed as a deduction from his total income. A Hong Kong company is taxed on its assessable profits. You may find these Hong Kong tax and accounting guides also useful in helping you make your decision:. What are the taxable incomes for Hong Kong companies?
Understand how to calculate Hong Kong corporate tax, also known as profits tax, in a correct way. Learn about Hong Kong tax treaties with other countries that prevent double-taxation for your business.
Learn why Hong Kong companies nIcome maintain proper books of accounts and satisfy statutory audit requirements on an annual basis. Get an overview of the ongoing statutory compliance and annual filing requirements for Hong Better For You Company private limited companies.
Make incorporating and operating your business simple Discover Hawksford services today. Discover Hawksford. Estimate your annual taxes See how Hong Kong stacks up against your home country. Tax calculator. In order to avoid double benefits, the Copmany enterprises shall be excluded from the two-tiered profits tax regime: enterprises electing the preferential half-rate tax regimes e.
Tax Incentives Available Profits tax exemption for eligible onshore and offshore funds operating in Hong Kong available. A fund can also enjoy profits tax exemption on its investments in both overseas and local private companies; with effect from 1 Aprilprofit tax deductions for Hong Kong Company Income Tax Rate expenditure incurred by enterprises for the purchase of intellectual property rights, i.
The company has to file a complete set of returns which includes the following: The specific profits tax return form as issued by the Inland Revenue Department A supplementary form as issued by the Inland Revenue Department for your tax data and financial data etc. Other documents and information as specified in Inco,e Notes and Instructions. Provisional Profits Tax Profits tax is payable on the assessable profits for each year of Txx. Your application for holding over of provisional tax should be lodged not later than: 28 days before the due date for payment of the provisional tax, or 14 days after the date of issue of the notice for payment of the provisional tax, whichever is later.
Late or not filing a tax return is a serious offense leading to penalties and even prosecution. Withholding Tax Rules Royalties and fees paid to non-resident entertainers or sportsmen for their performances in Hong Kong are subject to withholding tax on their assessable profits.
Such performance includes: any appearance of the entertainer or sportsman by Nico Insurance Company of or in connection with the promotion of any such Inome or event; any participation by the entertainer or sportsman in or for sound recording, films, videos, radio, television or Dtl Tv Company similar transmissions whether live Hong Kong Company Income Tax Rate recorded.
Relief from Double Taxation Double taxation arises when an income or profit is subject to tax in two jurisdictions — the country of source where the income is derived and the country of residence where Incomee income is received. Let us guide you further You may find these Hong Kong tax and accounting guides also useful in helping you make your decision:.
Find out how to take the burden out of tax and accounting. Normal issue date. For accounting year ended between. Due date for tax payment.
Corporate Tax Rate in Hong Kong averaged 16.57 percent from 1997 until 2019, reaching an all time high of 17.50 percent in 2004 and a record low of 16 percent in 1999. This page provides - Hong Kong Corporate Tax Rate - actual values, historical data, forecast, chart, ……
Detailed description of taxes on corporate income in Hong Kong. Hong Kong adopts a territorial basis of taxation. Profits tax is payable by every person (defined to include corporation, partnership, and sole proprietorship) carrying on a trade, profession, or business in Hong Kong on profits arising in or derived from Hong Kong from that trade, profession, or business.…
The first one is the traditional one: Single-Tier Corporate Tax System and the second one is Two-Tier Profits Tax Regime. Hong Kong has an attractive corporate tax regime highlighted by low tax rates. In Hong Kong, for Single-Tier Tax System: corporations are taxed at 16.5% on assessable profits and unincorporated businesses are taxed at 15%.…
Judgment Interest Rate; Status of Tax Cases; General Inspection; Public Forms and Pamphlets. Public Forms; Pamphlets; ... Tax Rates. Tax rates for the latest 7 years. Profits Tax; Property Tax; Salaries Tax; Personal Assessment; Annual Income level at which salaries taxpayers approach the standard rate zone .…
Double tax relief (by means of tax credit) is available for overseas tax (in the nature of a tax on profits) paid in jurisdictions which have concluded a CDTA with Hong Kong on the foreign income which is also subject to Hong Kong profits tax.…
All income tax information is based on the Inland Revenue Ordinance and is summarized by KPMG Tax Services Limited, the Hong Kong (SAR) member firm affiliated with of KPMG International Cooperative (“KPMG International”), a Swiss entity. There is no general income tax in Hong Kong (SAR).…
Hong Kong Tax Alert - Issue 1, January 2018. On 29 December 2017, the Inland Revenue (Amendment) (No. 7) Bill 2017 (Profits Tax bill) was gazetted (), thereby introducing a two-tiered profits tax rate regime.The key objectives of the Profits Tax bill are to maintain a competitive taxation system to promote economic development, while maintaining a simple and low tax regime.…
The HKIRD normally accepts this as satisfying the Hong Kong tax obligations of the non-resident. Hong Kong has so far entered into 43 treaties with different jurisdictions. The following table shows the applicable WHT rates for payments made from Hong Kong payers to non-treaty and treaty country corporate recipients.…
With effect from 24 May 1996, interest income and trading profits derived from a debt instrument issued in Hong Kong with an original maturity of not less than 5 years are subject to a concessionary tax rate equivalent to 50% of the normal profits tax rate.…