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Hong Kong profits tax two-level system implementation! These tax strategies must be known early


Hong Kong's two-tier system of profits tax will be implemented from April 1

The tax (Amendment) (No. 3) Ordinance 2018 (Amendment Ordinance) was gazetted on March 29 to implement the two-tier system of profits tax announced in the 2017 policy address.

The two-tier system of profits tax will apply to the year of assessment commencing on or after April 1, 2018. The profit tax rate of the first 2 million yuan of the corporation will be reduced to 8.25%, and the subsequent profits will continue to be taxed at 16.5%. As for the illegal group business of sole proprietorship or partnership business, the profit tax rate of the two levels is 7.5% and 15% respectively. Tax corporation or illegal corporation can save up to 165000 yuan and 150000 yuan each year.

01 information to be prepared by Hong Kong company for tax declaration

The preparation and materials to be submitted before reporting to Hong Kong companies for bookkeeping include:

Preparation before accounting: Although the Hong Kong government requires annual tax returns, enterprises generally can't wait until the end of the year to start processing accounting. Generally, they should start preparing accounting information when there are business operations;

Classification and arrangement of bills: classify, arrange and place sales invoices, cost invoices and expense invoices in chronological order. If there are many bills, number them in pencil in the upper right corner of the bill, and note that the date of all the documents provided is consistent with that of the accounting period;

Recognized instruments: compared with mainland China, the Hong Kong government recognizes all invoices (self-made), receipts and notes signed by the company.

Information to be submitted by Hong Kong company for account making:

Monthly bank statement and water list;

Sales bill: invoice, contract;

Cost bill: invoice, contract;

Expense note: salary, rent (lease contract or agreement must be provided), freight, etc;

Other relevant documents: one original of the articles of association, annual declaration form, all company change information (if any), fixed assets bills, investment related documents, the first three to five purchase and sale invoices and corresponding payment receipts in the next accounting year.

02 what is the impact of establishing a company in Hong Kong

One overdue fine 1200

3000 fine for second overdue

Receipt of court summons

Mandatory withholding / freezing of bank account

Company forced to cancel

Directors blacklisted for up to 6 months

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