Hong Kong offers significant tax advantages including a simple tax system, low rates of taxation and the opportunity to earn tax-free profits for companies engaging in international business activities.

Hong Kong has the following major taxes

Profits Tax – charged at the rate of 8.25% on the first HKD2m of profits from business activities taking place in Hong Kong and at 16.5% on profits above HKD2m. Companies whose business activities take place entirely outside of Hong Kong are not subject to Profits Tax (see the Offshore Profits Tax Exemption section of this website for further details).

Salaries Tax – charged at a maximum rate of 15% on an individual’s income from employment in Hong Kong.

Stamp Duty – charged at varying rates on the transfer value of property and shares dependent on the value of the asset being transferred.

The following taxes do not exist in Hong Kong

• Sales tax, GST or VAT.
• Tax on dividends.
• Tax on bank interest received.
• Witholding tax on management fees paid to overseas companies.
• Capital gains tax.
• Inheritance tax or estate duty.

In summary Hong Kong is a credible location for international businesses seeking a tax friendly environment without the negative image of their company being incorporated in an offshore tax haven.