Tax information for HK company for remote software consulting

[marc42]

Hello,

I have a company incorporated in Hong Kong (with a bank account in HK) that I used to do software development consulting.
We do not have an office anywhere, no employee, or anything else. It's just my computer and I.
I also do not pay myself any salary. I invoice the client using the company and invest the income in startups directly.

Now, I am trying to figure out where I should pay taxes for this company. I want to make sure I stay on the right side of the law.
The thing is that I have clients a bit all over the places (europe, usa, asia...) and I am personally moving around almost every other year.

Some people advised me to not fill for the foreign tax exemption in HK and pay the taxes there. But it is still not very clear to me if that's actually correct.

Did anyone have experience with how to do this correctly?

Ps: I am a French national currently living in the UK at the moment.

 

[Martin Everson]

Are you electing each yeah on your tax form to be taxed as a resident non-domicile in UK? You are a French national living in UK after all and are entitled to use your resident non-domicile tax status. Or are you electing to be taxed on the arising basis in UK?

You also need to look at UK CFC laws. Your HK company's place of operation, control and management is in your bedroom in UK...lol. So if your company is a CFC then the companies profits distributed or not are attributed to yourself directly as shareholder and are subject to tax in UK.

You need to speak to a tax advisor as UK tax avoidance legislation is complex.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[marc42]

Hey Martin,

Thanks for your answer.

I actually just moved to the UK 3 weeks ago, so that's something I would have to figure out. Thank you for pointing that out, as I would have totally overlooked this.

You do not happen to have a good tax advisor in the UK I could use, right? 🙂

Thanks for your help!

 

[aquarius]

I am looking into a similar situation where a company in HK has no HK taxable income and is managed from country that has territorial taxes, no CFC laws and does not consider this 'manage and control' a PE. This would leave the profits of the HK company completely untaxed. Which may sound exciting but may not be too future proof. I'm exploring whether or not this company can just file for taxes in HK.

 

[Martin Everson]

marc42 said:
You do not happen to have a good tax advisor in the UK I could use, right?
Click to expand...

I don't have any off head but find one the specializes in non-dom's. Don't pick any tax adviser. Pick one specifically who deals with non-dom affairs. They will tell you how to structure things and any money spent now will be saved later.

aquarius said:
Which may sound exciting but may not be too future proof.
Click to expand...

It will not be.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[fr33d0ml1fe]

aquarius said:
I am looking into a similar situation where a company in HK has no HK taxable income and is managed from country that has territorial taxes, no CFC laws and does not consider this 'manage and control' a PE. This would leave the profits of the HK company completely untaxed. Which may sound exciting but may not be too future proof. I'm exploring whether or not this company can just file for taxes in HK.
Click to expand...

Did you find a resolution to this?