Malaysia Hotline: +603- 2141 8908
Profits
Tax is levied at the rate of 16.5% (for 2013/14) on corporations, and 15% (for
2013/14) on unincorporated entities on business profits which satisfy both of
the following criteria:
-
The company must be carrying on business in Hong Kong.
-
The relevant profits must be earned in or derived from Hong Kong and is not
capital in nature.
Source
The
source of income is generally regarded as a “practical hard matter of fact”. In
the context of international operations, this typically means that the person
ultimately deriving the income may have some tax planning opportunities. Rates
of Hong Kong taxation are low and with care effective rates can be made even
lower. Hong Kong does not have any form of dividend taxation or withholding
taxes (other than on royalties paid to non-residents) and hence profits
accumulated in a Hong Kong company can be distributed without withholding tax
leakage in Hong Kong.
Withholding Taxes
There
are withholding taxes on royalties paid to non-residents. The payer is required
to withhold tax on the royalty payment and file a tax return as agent for the
non-resident recipient.
Interest
Deposit
interest accruing to individuals and Hong Kong companies from deposits placed
in Hong Kong is generally exempt from Profits Tax, unless certain conditions in
the Inland Revenue Ordinance apply. Interest accruing to Hong Kong companies
from deposits placed in offshore bank accounts is not subject to Hong Kong
Profits Tax. It is not difficult for Hong Kong companies to place deposits in
offshore accounts.
Tax Returns
Any
company potentially liable to Profits Tax will be issued with a profits tax
return for completion. This should be submitted within one month of issue
(although in practice longer periods may be granted upon application) together
with audited financial statements covering the company’s accounting year ending
in the relevant year of assessment.
The
profits tax return forms the basis for a tax assessment in respect of the
relevant year of assessment. For example, a company with a 31 December year-end
would report its results for the year ended 31 December 2013 in its profits tax
return for the year of assessment 2013/14.
Contact us
If you have further queries, please contact Tannet
24 hours Malaysia hotline：603-21418908;
24 hours Hong Kong hotline：852-27837818;
24 hours Hong Kong hotline：86-755- 36990589;
Email: mytannet@gmail.com
TANNET GROUP : http://www.tannet-group.net, http://en.tannet.com.my