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DIPN 48 (29 March 2012)

 

The Departmental Interpretation and Practice Notes No. 48 ("Advance Pricing Arrangement") is issued on 29 March 2012 and is intended to provide guidance on Advance Pricing Arrangement (APA) to enterprises. It explains in detail the APA process, in particular the terms and conditions under which an APA may be granted by the Commissioner. The Inland Revenue Department will roll out the APA programme as from 2 April 2012.

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Hong Kong signed a comprehensive agreement with Jersey on avoidance of double taxation (24 February 2012)

 

Hong Kong signed on February 22 an agreement with Jersey for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income. Please click here for the details.

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The Agreement between the Hong Kong Special Administrative Region of the People's Republic of China and the Kingdom of Spain for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income will come into effect on 13 April 2012 (6 February 2012)

 

The Agreement between the Hong Kong Special Administrative Region of the People's Republic of China and the Kingdom of Spain for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income ("the Agreement") was formally signed on 1 April 2011.

According to Article 26 of the Agreement, the Agreement shall, upon the written notifications by both sides of the completion of their respective required approval procedures, enter into force after a period of three months following the date of receipt of the later of these notifications.

On 10 October 2011 Spain notified Hong Kong in writing of the completion of its approval procedures.

For the purposes of giving effect to the Agreement, an Order was made by the Chief Executive in Council on 8 November 2011 under section 49(1A) of the Inland Revenue Ordinance. The Order was published in the Gazette as Legal Notice 156 of 2011. The Order was laid before the Legislative Council for negative vetting on 23 November 2011. The vetting period expired on 11 January 2012 and no resolution was made by the Legislative Council to amend the whole or any part of the Order. On 13 January 2012, Hong Kong sent a notification of the completion of the ratification procedures to Spain. On 16 January 2012, Spain acknowledged receipt of the notification from Hong Kong. The Agreement therefore will become effective on 13 April 2012 and shall have effect in Hong Kong, according to paragraph 3 of Article 26 of the Agreement, for any year of assessment beginning on or after 1 April 2013.

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The Agreement between the Government of the Hong Kong Special Administrative Region of the People's Republic of China and the Government of the Czech Republic for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income has come into effect on 24 January 2012 (6 February 2012)

 

The Agreement between the Government of the Hong Kong Special Administrative Region of the People's Republic of China and the Government of the Czech Republic for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income ("the Agreement") was formally signed on 6 June 2011.

According to Article 26 of the Agreement, the Agreement shall, upon the written notifications by both sides of the completion of their respective required approval procedures, enter into force on the date of the later of these notifications.

For the purposes of giving effect to the Agreement, an Order was made by the Chief Executive in Council on 8 November 2011 under section 49(1A) of the Inland Revenue Ordinance. The Order was published in the Gazette as Legal Notice 157 of 2011. The Order was laid before the Legislative Council for negative vetting on 23 November 2011. The vetting period expired on 11 January 2012 and no resolution was made by the Legislative Council to amend the whole or any part of the Order. On 13 January 2012, Hong Kong sent a notification of the completion of the ratification procedures to the Czech Republic. On 26 January 2012, Hong Kong received a notification dated 24 January 2012 from the Czech Republic confirming the completion of the requisite approval procedures and the receipt of Hong Kong's notification. The Agreement therefore becomes effective on 24 January 2012 and shall have effect in Hong Kong, according to paragraph 2 of Article 26 of the Agreement, for any year of assessment beginning on or after 1 April 2013.

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The Agreement between the Government of the Hong Kong Special Administrative Region of the People's Republic of China and the Government of the French Republic for the Avoidance of Double Taxation with respect to Taxes on Income and on Capital and the Prevention of Fiscal Evasion comes into effect on 1 December 2011 (1 December 2011)

 

The Agreement between the Government of the Hong Kong Special Administrative Region of the People's Republic of China and the Government of the French Republic for the Avoidance of Double Taxation with respect to Taxes on Income and on Capital and the Prevention of Fiscal Evasion ("the Agreement") was formally signed on 21 October 2010.

According to Article 28 of the Agreement, the Agreement shall, upon the written notifications by both sides of the completion of their respective required approval procedures, enter into force on the first day of the month following the day when the later of these notifications has been received.

For the purposes of giving effect to the Agreement, an Order was made by the Chief Executive in Council on 3 May 2011 under section 49(1A) of the Inland Revenue Ordinance. The Order was published in the Gazette as Legal Notice 65 of 2011. The Order was laid before the Legislative Council for negative vetting on 18 May 2011. The vetting period expired on 6 July 2011 and no resolution was made by the Legislative Council to amend the whole or any part of the Order. On 8 July 2011, Hong Kong sent a notification of the completion of the ratification procedures to France. On 3 November 2011, Hong Kong received a notification dated 3 November 2011 from France confirming the completion of the requisite approval procedures. The Agreement therefore becomes effective on 1 December 2011 and shall have effect in Hong Kong, according to paragraph 2 of Article 28 of the Agreement, for any year of assessment beginning on or after 1 April 2012.

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The Agreement between the Government of the Hong Kong Special Administrative Region of the People's Republic of China and the Government of New Zealand for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income has come into effect on 9 November 2011 (10 November 2011)

 

The Agreement between the Government of the Hong Kong Special Administrative Region of the People's Republic of China and the Government of New Zealand for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income ("the Agreement") was formally signed on 1 December 2010.

According to Article 26 of the Agreement, the Agreement shall, upon the written notifications by both sides of the completion of their respective required approval procedures, enter into force on the date of the later of these notifications.

For the purposes of giving effect to the Agreement, an Order was made by the Chief Executive in Council on 3 May 2011 under section 49(1A) of the Inland Revenue Ordinance. The Order was published in the Gazette as Legal Notice 67 of 2011. The Order was laid before the Legislative Council for negative vetting on 18 May 2011. The vetting period expired on 6 July 2011 and no resolution was made by the Legislative Council to amend the whole or any part of the Order. On 8 July 2011, Hong Kong sent a notification of the completion of the ratification procedures to New Zealand. On 9 November 2011, Hong Kong received a notification dated 9 November 2011 from New Zealand confirming the completion of the requisite approval procedures. The Agreement has therefore become effective on 9 November 2011 and shall have effect in Hong Kong, according to paragraph 2 of Article 26 of the Agreement, for any year of assessment beginning on or after 1 April 2012.

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Hong Kong signed on November 8 a comprehensive agreement with the Republic of Malta on avoidance of double taxation (9 November 2011)

 

Hong Kong signed on November 8 an agreement with the Republic of Malta for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income.

The Secretary for Financial Services and the Treasury, Professor K C Chan, signed in Hong Kong (November 8) an agreement with the Republic of Malta for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income on behalf of the Hong Kong Special Administrative Region Government. The Ambassador of Malta to China, Mr Joseph Cassar, signed on behalf of his Government. Please click here for the details.

 

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The Agreement between the Hong Kong Special Administrative Region of the People's Republic of China and the Kingdom of the Netherlands for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income has come into effect on 24 October 2011 (25 October 2011)

 

The Agreement between the Hong Kong Special Administrative Region of the People's Republic of China and the Kingdom of the Netherlands for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income ("the Agreement") was formally signed on 22 March 2010.
According to Article 29 of the Agreement, the Agreement shall, upon the written notifications by both sides of the completion of their respective required approval procedures, enter into force on the fifth day after the date of receipt of the later notification.

For the purposes of giving effect to the Agreement, an Order was made by the Chief Executive in Council on 22 June 2010 under section 49(1A) of the Inland Revenue Ordinance. The Order was published in the Gazette as Legal Notice 90 of 2010. The Order was laid before the Legislative Council for negative vetting on 14 July 2010. The vetting period expired on 17 November 2010 and no resolution was made by the Legislative Council to amend the whole or any part of the Order. On 19 November 2010, Hong Kong sent a notification of the completion of the ratification procedures to the Netherlands. On 19 October 2011, Hong Kong received a notification dated 18 October 2011 from the Netherlands confirming the completion of the requisite approval procedures. The Agreement has therefore become effective on 24 October 2011 and shall have effect in Hong Kong, according to paragraph 2 of Article 29 of the Agreement and the Note from the Netherlands to the Hong Kong Special Administrative Region dated 22 March 2011 and the Hong Kong Special Administrative Region's Note in reply dated 29 March 2011, for any year of assessment beginning on or after 1 April 2012.

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The Protocol to the Agreement between the Hong Kong Special Administrative Region of the People's Republic of China and the Grand Duchy of Luxembourg for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital has come into effect on 17 August 2011 (25 August 2011)

 

The Protocol to the Agreement between the Hong Kong Special Administrative Region of the People's Republic of China and the Grand Duchy of Luxembourg for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital ("the Protocol") was formally signed on 11 November 2010.
According to Article 4 of the Protocol, the Protocol shall, upon the written notifications by both Sides of the completion of their respective required approval procedures, enter into force on the later of these notifications.

For the purpose of giving effect to the Protocol, an Order was made by the Chief Executive in Council on 3 May 2011, under section 49(1A) of the Inland Revenue Ordinance. The Order was published in the Gazette as Legal Notice 68 of 2011. The Order was laid before the Legislative Council for negative vetting on 18 May 2011. The vetting period expired on 6 July 2011 and no resolution was made by the Legislative Council to amend the whole or any part of the Order. On 8 July 2011, Hong Kong sent a notification of the completion of the ratification procedures to Luxembourg. On 17 August 2011, Hong Kong received a notification dated 17 August 2011 from Luxembourg confirming the completion of the requisite approval procedures. The Protocol has therefore become effective on 17 August 2011 and shall have effect in Hong Kong, according to Article 4 of the Protocol, for any year of assessment beginning on or after 1 April 2012.

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The Agreement between the Government of the Hong Kong Special Administrative Region of the People's Republic of China and the Government of Japan for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income has come into effect on 14 August 2011 (15 August 2011)

 

The Agreement between the Government of the Hong Kong Special Administrative Region of the People's Republic of China and the Government of Japan for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income ("the Agreement") was formally signed on 9 November 2010.
According to Article 29 of the Agreement, the Agreement shall, upon the written notifications by both Sides of the completion of their respective required approval procedures, enter into force on the thirtieth day after the date of receipt of the later notification.

For the purpose of giving effect to the Agreement, an Order was made by the Chief Executive in Council on 12 April 2011, under section 49(1A) of the Inland Revenue Ordinance. The Order was published in the Gazette as Legal Notice 64 of 2011. The Order was laid before the Legislative Council for negative vetting on 18 May 2011. The vetting period expired on 6 July 2011 and no resolution was made by the Legislative Council to amend the whole or any part of the Order. On 8 July 2011, Hong Kong sent a notification of the completion of the ratification procedures to Japan. On 15 July 2011, Hong Kong received a notification dated 15 July 2011 from Japan confirming the completion of the requisite approval procedures. The Agreement has therefore become effective on 14 August 2011 and shall have effect in Hong Kong, according to paragraph 2 of Article 29 of the Agreement, for any year of assessment beginning on or after 1 April 2012.

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The Agreement between the Government of the Hong Kong Special Administrative Region of the People's Republic of China and the Government of the Principality of Liechtenstein for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital has come into effect on 8 July 2011 (10 August 2011)

 

The Agreement between the Government of the Hong Kong Special Administrative Region of the People's Republic of China and the Government of the Principality of Liechtenstein(“("Liechtenstein") for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital ("the Agreement") was formally signed on 12 August 2010.
According to Article 28 of the Agreement, the Agreement shall, upon the written notifications by both Sides of the completion of their respective required approval procedures, enter into force on the date of the later of these notifications.

For the purpose of giving effect to the Agreement, an Order was made by the Chief Executive in Council on 3 May 2011, under section 49(1A) of the Inland Revenue Ordinance. The Order was published in the Gazette as Legal Notice 66 of 2011. The Order was laid before the Legislative Council for negative vetting on 18 May 2011. The vetting period expired on 6 July 2011 and no resolution was made by the Legislative Council to amend the whole or any part of the Order. Hong Kong received a notification dated 16 March 2011 from Liechtenstein confirming the completion of its approval procedures. On 8 July 2011, Hong Kong sent a notification of the completion of the ratification procedures to Liechtenstein. The Agreement has therefore become effective on 8 July 2011 and shall have effect in Hong Kong, according to paragraph 2 of Article 28 of the Agreement, for any year of assessment beginning on or after 1 April 2012.

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Standard forms for application of certificate of resident status under a comprehensive agreement for the avoidance of double taxation (13 July 2011)

 

With immediate effect, any application for a certificate of Hong Kong resident status under a comprehensive agreement for the avoidance of double taxation signed between Hong Kong and other jurisdictions (apart from the Mainland of China) has to be made on the standard form IR1313B (for company, partnership, trust or other body of persons) or IR1314B (for individuals). For applications involving the Mainland of China, standard form IR1313 / IR1313A / IR1314 / IR1314A should continue to be used. The forms can be downloaded from the Inland Revenue Department Homepage at www.ird.gov.hk.

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Tax arrangements on dividends paid to Hong Kong residents by Mainland companies clarified (4 July 2011)

 

The Financial Services and the Treasury Bureau today (July 4) said that the Hong Kong Special Administrative Region Government has received a reply from the State Administration of Taxation that clarified the arrangements concerning the tax payable to the Mainland for dividends paid by Mainland companies to individual investors in Hong Kong.

A spokesman for the Financial Services and the Treasury Bureau said, "The reply of the State Administration of Taxation notes that when non-foreign investment companies of the Mainland which are listed in Hong Kong distribute dividends to their shareholders, the individual shareholders in general will be subject to a withholding tax rate of 10% with reference to the arrangement for the avoidance of double taxation signed between Mainland China and Hong Kong. They do not have to make any applications for entitlement to the above-mentioned tax rate.

"For shareholders who are residents of other countries and whose home countries have reached an agreement with China on an applicable withholding tax rate higher or lower than 10%, they have to follow the bilateral tax agreement in paying tax in connection with dividends paid by Mainland companies listed in Hong Kong."

The spokesman said that the Stock Exchange of Hong Kong Limited will issue a letter to listed companies to inform them of the above-mentioned tax arrangements concerning dividends paid by Mainland companies. 

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Hong Kong signed on June 6 a comprehensive agreement with Czech Republic on avoidance of double taxation (7 June 2011)

 

Hong Kong signed on June 6 an agreement with Czech Republic for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income.

The Secretary for Financial Services and the Treasury, Professor K C Chan, signed in Prague yesterday (June 6, Prague time) an agreement with the Czech Republic for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income on behalf of the Hong Kong Special Administrative Region Government. The Czech Minister of Finance, Mr Miroslav Kalousek, signed on behalf of his Government. Please click here for the details.

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Hong Kong signed on April 1 a comprehensive agreement with Spain on avoidance of double taxation (1 April 2011)

 

Hong Kong signed on April 1 an agreement with Spain for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income.

The Chief Secretary for Administration, Mr Henry Tang, signed the agreement in Hong Kong on behalf of the Hong Kong Special Administrative Region Government. The Spanish Second Vice-President, Ms Elena Salgado, signed on behalf of her Government. Please click here for the details.

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