April 10, 2021 Uncategorized 0

Find out which countries and regions have a DtA with New Zealand. Find out how DBAs are more exempt from double taxation than they are under national law. If two jurisdictions impose their global income on their inhabitants, it could be double taxation. Fortunately, Hong Kong has signed double taxation agreements (DBA) with several countries and supports the territorial tax base. This means that taxes only fall on Hong Kong`s income. In most cases, profits made by a resident outside Hong Kong are not taxable. Tax treaties are a way to promote cooperation with other tax administrations and to prevent double taxation and tax evasion. The DBA is an initiative of the Hong Kong Administrative Region government to minimize the double taxation of its residents and DBA partners. Often referred to as source-residence conflict, double taxation occurs if you are charged twice on the same profit or income. Hong Kong has signed 40 DBAs or bilateral agreements with mainland China, Thailand, Belgium, Luxembourg and Vietnam.

When it comes to avoiding double taxation in Hong Kong, the criteria are used to charge foreign taxes on foreign income. This requires the deduction of the tax payable in the main jurisdiction of the tax on the same income that must be paid in the jurisdiction of residence. However, the tax credit does not apply to the tax payable in the jurisdiction of the sources and is limited to residency jurisdiction. All of our DTAs contain a MAP article. A Singapore tax subject who suffers from double taxation or who believes that double taxation is imminent and who believes that the taxation imposed by the competent tax authorities is not consistent with the determination of the DBA concerned may ask the IRAS to resolve the issue of double taxation under the ARTICLE of the POP. For more information on MAP. If the rules for the distribution of revenue are clearly defined between two legal orders, there is no risk of double taxation. The DBA also defines how the tax is introduced and guides taxpayers beyond the possible limits of tax debt. Taxpayers can apply for relief for taxes already paid abroad.

The DBA avoids not only double taxation, but also tax evasion. In most contracts signed by Hong Kong, residents can avoid double taxation through a tax credit. As a resident, you are subject to DBA rules to avoid double taxation in Hong Kong.