The end of Hong kong company ?

[Mimimel]

Hi, i just got a notice from my agent in HK about the fact that the director's salaries have a chance to be taxed in HK even if the director is foreign.

Looking quickly I see that for 200k HKD or more it would be 17% tax...

It is possible to apply for an exemption but not guaranteed according to him.

So I wonder as I know that 99% of people who have a company in HK pay their taxes in the country of residence, ex dubai so 0%.

Have you ever had this kind of problem to manage in Hong Kong ? Or my agent is really bad ?

 

[MiltonStone]

That's bad news. You may check if HK has any double tax treaty with the‌ country of your residency, not sure if the have such in place at all.

 

[Mimimel]

They probably have a double tax treaty, but that not work⁠ if you pay 0% in your contry of residence.

But I find it strange that⁤ nobody talks about this, while the setup in HK is rather popular....

 

[Marzio]

Probably because people don't take out money from the company as salary but instead take out‌ dividends

 

[Mimimel]

Yes but you need to get the profit‍ tax exemption for take dividends at 0% otherwise it is 8%/16%

 

[drpreobrazhensky]

In Hong Kong you have to apply for the offshore exemption every year with the‌ IRD. So make sure to tell your service provider / accounting provider in HK to‍ apply for the exemption. I've never had IRD not grant it, so you should be⁠ fine. As long as you don't have any team members or customers in Hong Kong,⁤ you meet all the criteria, and should be granted the exemption without a fuss.

 

[Mimimel]

Yes about profit but about salary it is the first time⁢ i heard that. So 2 offshores exemptions becomes to be expensive to ask and increase︀ the risk to pay a tax...

 

[Cryptohodler]

https://home.kpmg/cn/en/home/insigh...-foreign-sourced-income-exemption-regime.html

@Mimimel how does the︁ above affect your offshore business profits ? I guess it has no effect