Company Formation Hong Kong
Articles

Hong Kong – Korea Double Tax Treaty

Updated on Wednesday 07th September 2016

Rate this article
5 5 1
based on 0 reviews


Hong-Kong-Korea-Double-Tax-Treaty.jpgHong Kong and Korea have signed a comprehensive double taxation agreement. This bilateral tax treaty serves the purpose of providing resident individuals and companies with double taxation relief but it is also used to prevent tax evasion.
 
The double tax agreement (DTA) applies on all taxes on income levied by the Governments of the Contracting Parties.
 

Taxes covered by the Hong Kong – Korea DTA

 
The double tax treaty applies for the following taxes in case of Hong Kong:
- the profits tax,
- the salaries tax,
- the property tax.
 
For Korea, the treaty covers the income and the corporate tax, the local income tax and the tax levied for rural development. All other taxes impose din place of the ones listed or in addition to them will also be covered by the treaty.
 
The double tax treaty is advantageous for foreign investors from Korea in Hong Kong. According to the provisions of the agreement, the withholding tax rates for dividends, interest and royalties are reduced. The usual withholding tax rate on dividends is 20% and under the treaty, this rate is 10% or 15%, depending on the company making the payment. The lowest rate applies if the company receiving the dividend payment holds at least 25% of the capital belonging to the company making the payment. A 0% withholding tax rate is possible if the owner of the interest is the Hong Kong Government or other governmental institutions.
 

General provisions of the Hong Kong – Korea DTA

 
According to the definitions set forth in the treaty, a company in Hong Kong is subject to the tax reductions if it is incorporated in the Hong Kong Special Administrative Region or if it is incorporated elsewhere but managed from Hong Kong. 
 
A permanent establishment in Hong Kong that can benefit from the provisions of the DTA is a management office, branch in Hong Kong, factory, workshop, mine or other place used for extracting natural resources.
 
A Hong Kong resident is an individual who resides in Hong Kong or who spends more than 180 days in the Special Administrative Region during one taxable year. 
 
Our company registration agents in Hong Kong can help you with detailed information about how the double tax treaty applies to your company or your personal income.
 
 

Comments

There are no comments

Comments & Requests


Please note that client queries should NOT be posted here but sent through our Contact page.

Meet us in Hong Kong

Call us now at + 852 8191 3385  to set up an appointment with our company formation experts in Hong Kong. As a DM Advisory client, you will benefit from the joint expertise of local lawyers and consultants for opening an offshore company in Hong Kong.

We offer:

- prompt response to your inquiry (maxim 24 hours);

- cost-efficiency: competitive company formation prices;

- free and complete legal information featured on our site, at your disposal.

Testimonials

Francesco-Dagnino.jpg

I have been working with partners at OpenCompanyHongKong.com for several years now and I am extremely pleased with their services. Their team helped my clients extend their businesses in Hong Kong.

Francesco Dagnino, Partner of
Lexia Avvocati
www.LawyersItaly.eu

Read more testimonials

We Recommend ClientPedia

This website is marketed by ClientPedia

Banner-Promoting ClientPedia-244px.jpg

We accept online payments

paypal-logo.png