Corporations should review how the new FSIE regime will impact their tax liability of their passive income and whether any actions should be taken.
A service PE is maintained by a foreign entity in Mainland China, the relevant individuals assigned to Mainland China will potentially be exposed to Mainland China individual income tax, irrespective of whether or not the individuals stayed in Mainland China for more than 183 days in a year.
Replying to IRD enquiries has to be handled with great care and strategies. Provision of unfavourable or inconsistent information to the IRD may not only render the tax claims fail but also potentially result in IRD enquiries on a further tax probe such as a full tax audit and investigation.
It is sometimes controversial whether conditions for an offshore non-taxable claim in Hong Kong are met. Here’s how to prepare for it.