The Arrangement between the Mainland of China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income (DTA) entered into force on December 8, 2006 and has been supplemented by a number of subsequent protocols in 2008, 2010 and 2015.
On 19 July 2019, Hong Kong and China have signed the 5th Protocol to the DTA which provides tax relief to qualified Hong Kong and China teachers and researchers. This document is important for the training, exchange of talents and cooperation in scientific research. It also incorporates measures aimed at preventing tax treaty abuse, which form part of the Base Erosion and Profit Shifting (BEPS) package promulgated by the Organisation for Economic Co-operation and Development (OECD) to ensure that the DTA follows the latest standard of international tax rules.
The 5th Protocol will come into force when the ratification procedures and notification by both sides is completed.
It should be noted that the tax relief for teachers and researchers would be a welcomed measure to drive the development of scientific research and innovation in the Guangdong-Hong Kong-Macau Greater Bay Area.
Filed under: Business and Economy, Offshore Legislation, Taxation
Hong Kong Financial News 