Tel：+86 400 118 5939Address：Room 2810B, Block A, Tianli Central Plaza, Coastal City, Yuehai Street, Nanshan District, Shenzhen, Guangdong Province
Email：info@hyintern.com
+86 400 118 5939
牌照号：TC004750
Tel：+86 400 118 5939Hong Kong, as the closest offshore financial center to the mainland and with its status as a free port, is extremely convenient for both capital and goods to enter and exit Hong Kong, making it one of the most popular places for global merchants to register their companies. The mainland and Hong Kong are only separated by a river, making it very convenient for mainland businessmen to travel to Hong Kong. Moreover, Hong Kong's company tax is lower than that of mainland China, which has led to a continuous increase in the number of mainland businessmen registering companies in Hong Kong. What is the latest Hong Kong corporate profit tax rate for 2020? How should it be calculated?
After the normal audit, tax reporting, and assessment of Hong Kong companies every year, the Hong Kong Inland Revenue Department will divide Hong Kong limited companies according to their profit situation in the declared fiscal year. If the company's operating profit does not reach HKD 2 million, it can be taxed at the newly implemented 8.25%; For profits exceeding HKD 2 million, the first HKD 2 million will still be subject to a tax rate of 8.25%, and the excess profits will only be subject to a tax rate of 16.5%, which is applicable to all industries.
The significant new attraction of Hong Kong lies in its numerous preferential policies, as follows:
1. Hong Kong companies can deduct all expenses such as entertainment, transportation, and travel expenses when doing accounting and tax reporting.
2. The salaries of directors and their spouses can be deducted as expenses.
3. Operating as a Hong Kong limited company, profits from overseas sources can apply for exemption from paying profits tax overseas.
4. By using a Hong Kong limited company to transfer buildings, significant profits tax, stamp duty, and legal fees can be saved.
5. The tax rate for limited company profits in Hong Kong is 16.5%, while the tax rate for unlimited company profits is 15% (net profit), which is almost the lowest in the world.
6. Overseas immigrants, such as those from the United States and Canada, can avoid paying double taxes in Hong Kong and abroad by using a limited company.
7. Expenses such as installment interest on buildings and cars, as well as depreciation allowances for fixed assets, can be fully deducted.
In addition, according to the Hong Kong Budget, for those who need to pay corporate profits tax in the 2018/19 fiscal year, a one-time 75% reduction in profits tax will be granted, with a maximum reduction of HKD 20000. At the same time, 75% of salary tax and comprehensive income tax will be reduced, with a maximum reduction of HKD 20000. Combining Hong Kong's tax system that only taxes the pure profit portion of enterprises with the tax incentives policies formulated by the Hong Kong government, it is highly competitive on a global scale.
It should be noted that if a company does not operate in Hong Kong within a fiscal year and does not have a company bank account, it can apply for zero tax reporting from the government and apply for exemption from bookkeeping.
Scan QR code to follow 【Hongyuan International WeChat】
Email: info@hyintern.com
Hotline: +86 400 118 5939
