Taxation in Hong Kong
Taxation in Hong KongUpdated on Wednesday 31st January 2018
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A simple taxation regime
Hong Kong is a world-class business destination not only because of its strategic position in Asia but also because of the simple and low taxation regime. The Hong Kong Special Administrative Region has an independent taxation system from the Mainland China. Compared to other countries, Hong Kong has a simple, transparent and easy taxation regime.
Hong Kong imposes two types of taxes: direct taxes and indirect taxes. Companies must pay the corporate income tax while individuals are taxed on their salaries. Our lawyers in Hong Kong and help you understand the taxation system in Hong Kong and give you personalized information about the taxes you have to pay while doing business here.
We invite you to watch a short video about taxation in Hong Kong:
Corporate tax in Hong Kong
The corporate income tax in Hong Kong has a 16.5 percent rate. Because Hong Kong is a considered a special administrative region, taxation is not imposed based on the residence of the company. Companies in Hong Kong must observe the requirements for submitting the annual tax returns.
Hong Kong has no withholding taxes on dividends, on interest or any other type of income paid to residents or non-residents. The property tax is 15 percent and there is no estate tax. Hong Kong is also a taxation haven for import and export activities. Duty is paid only for a few products and Hong Kong has a free port status. Hong Kong has also signed a number of tax treaties for avoiding double taxation.
The taxation system in Hong Kong is advantageous for many types of companies, including branches or subsidiaries of foreign corporations. Our Hong Kong law firm offers complete services for companies and our agents can help you submit all the necessary tax returns.
Taxation on individuals in Hong Kong
The tax imposed on individuals in Hong Kong is the salaries tax, also known as the personal tax. Just like the corporate tax, the salaries tax is also low compared to that in other countries and individuals working in Hong Kong enjoy these benefits.
The salary tax in Hong Kong is progressive and applies only to the income produced in Hong Kong. There is no inheritance tax and individuals can also try to reduce the salaries ta through personal assessment. Our Hong Kong lawyers can tell you more about tax minimization in Hong Kong and can help you calculate the amount of tax according to your chargeable income.
For more information about taxation in Hong Kong and professional assistance, please contact our Hong Kong law firm.