Hong Kong Italy Double Taxation Agreement

In June 2001, Hong Kong concluded a limited maritime traffic agreement with the United Kingdom. The agreement is limited to revenues from international maritime traffic and provides that profits made by a UK company or SAR as a result of such transactions are exempt from the territory of the other party. The provisions of the agreement, which come into force on 3 May 2001, apply to corporation tax in the United Kingdom from 1 April 2002 and from 6 April 2002, apply to income and capital gains tax. It applied to the RAD as of April 1, 2002. In August 2006, the Chinese and Hong Kong authorities signed an agreement to avoid double taxation, which aims to guarantee tax debt and tax savings to investors and taxpayers in both localities.    The agreement will further strengthen economic and trade relations between the two localities and provide more incentive for Italian companies to do business or invest in Hong Kong, he added. In September 2012, the Commissioner for Finance stated that Hong Kong had made “remarkable progress” in establishing its international network of tax treaties since the change in the internal income system in March 2010, and that since then the network of tax treaties in Hong Kong has rapidly expanded. As of March 2018, 37 global double taxation agreements were in force in Hong Kong.    Under the CDTA, Hong Kong airlines flying to Italy are taxed at the Hong Kong corporate tax rate (which is lower than Italy) and are not taxed in Italy. The profits from international shipping made by the inhabitants of Insehong Kong, who are produced in Italy and are currently taxed there, are not taxed in Italy under the agreement. Under Article 151 of the Basic Law, Hong Kong is free to negotiate its own double taxation conventions independently of mainland China (i.e..dem the rest of the People`s Republic of China), using the acronym Hong Kong, China.

The territory cannot resort to double taxation agreements that China can enter into, as these treaties only mention taxes on the continent. Mainland China will also not impose double taxation conventions on the territory, since under Articles 106 to 108 of Hong Kong`s Basic Law, it guaranteed the right to maintain an independent tax system without continental interference until 2047. Under the agreement, Hong Kong residents who receive dividends from New Zealand that are not attributable to an institution in New Zealand are subject to a reduced withholding rate of 15%. The withholding rate is further lowered to 5% or 0% for eligible beneficiaries. Hong Kongers who receive royalties from New Zealand pay a withholding tax capped at 5%. Prior to the December 2003 agreement, royalties granted by a Hong Kong resident from a Belgian source that was not attributable to any stable establishment in Belgium were subject to a Belgian withholding tax of 15% on the gross amount of royalties, net of a fixed deduction of 15%. Under the agreement, the Belgian withholding tax was set at 5% of the gross amount of royalties (excluding the 15% vat deduction). Drop. With regard to interest received by a Hong Kong resident residing in Belgium, which is not attributable to a stable establishment in Belgium, the Belgian withholding tax has been reduced from 15% of the gross rate to 10% under the agreement.    This is Hong Kong`s 27th Comprehensive Double Taxation Prevention Agreement (CDTA) with its trading partners, concluded after Belgium, Thailand, mainland China, Luxembourg, Vietnam, Brunei, the Netherlands, Indonesia, Hungary, Kuwait, Austria, the United Kingdom, Ireland, Liechtenstein, France, Japan, New Zealand, Portugal, Spain, Switzerland, Malta, Jersey Malaysia and Mexico.