Hong Kong Taxation
Hong Kong adopts a territorial source principle of taxation. Only profits which have a source in Hong Kong are taxable here. Profits sourced elsewhere are not subject to Hong Kong Profits Tax. The principle itself is very clear but its application in particular cases can be, at times, contentious. To clarify the operation of the principle, HKIRD has prepared a simple guide on the territorial source principle of taxation. It gives a brief explanation of how the principle operates and provides simple examples for illustrative purposes of the tests applied to different types of businesses. For the guide, please click the following topic “Does Hong Kong Company’s profit require wholly subject to Profits tax?”. If you wish to explore your situation in depth, please feel free to consult us for professional advice.
The following topics may give you a quick reference in the area you have interest:
Inland Revenue Department’s Forms
Inland Revenue Department’s FAQ
Does Hong Kong Company’s profit require wholly subject to Profits tax?
Departmental Interpretation & Practice Notes 21
Application for Full/Partial Exemption of Income under Salaries Tax