Is the gain from disposal of property subject to tax?

Generally speaking, no. The gain from disposal of property is regarded as profit arising from the sale of capital which is not subject to tax. However, tax might be imposed if such sale of the property is akin to a commercial or speculative activity. The IRD may impose a profit tax in such situations.

Is there double taxation in Hong Kong?

Double taxation arises when two or more tax jurisdictions overlap, such that the same item of income or profit is subject to tax in each. Under Hong Kong’s territorial source principle of taxation, Hong Kong residents generally are not subject to double taxation. This article will help you understand (i) the double tax arrangements/agreements; (ii) … Read more

What is the tax system in Hong Kong?

Hong Kong is known for having a simple tax regime with low tax rates, which explains why many are attracted to carry out business in Hong Kong. This article will help you understand (i) the territorial source principle of taxation; (ii) the different types of taxes; (iii) the double tax agreements/arrangements; and (iv) the relevant … Read more

What business records should I keep in Hong Kong?

Sufficient records would enable ascertainment of your business’s assessable profits, which is essential for the calculation of profits tax. Business records should be kept for at least seven years after the date of the transactions concerned. Failure to comply with such a requirement may be liable to a fine up to HKD 100,000. To confirm … Read more

How do I file a profits tax return?

Profits tax is charged for each year of assessment. The basis period for profits tax assessment is:- the year ended 31 March of the year printed on the return; or where the annual accounts are made up to any day other than 31 March, the year ended on that day within the year printed on … Read more

What tax does my company need to pay in Hong Kong?

In Hong Kong, both unincorporated and incorporated businesses are required to pay profits tax and stamp duty.  Simply put, income sourced in Hong Kong is subject to profits tax. Stamp duty is charged on documents connected with conveyance on sale, agreement for sale or lease of immovable property, and share transfer. 

How does the profits tax regime work in Hong Kong?

Hong Kong adopts a two-tiered profits tax rates regime. Persons, including corporations, partnerships, trustees and bodies of persons carrying on any trade, profession or business in Hong Kong are chargeable to tax on all profits arising in or derived from Hong Kong from such trade, profession or business. Hence, there is no distinction made between … Read more

How is a Business Licence different from Business Registration?

When setting up a business in Hong Kong, it is important that you are aware of the business registration process and whether a licence is required for your business so as not to contravene any laws. You have to register for any business in Hong Kong, and may or may not have to apply for … Read more