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Taxation Legislation

IS THERE ANY POINT IN A PERSON APPEALING AGAINST AN UNFAVOURABLE TAX ASSESSMENT?

October 28, 2011

Following the decision in CG Lighting Limited v CIR, I would find it difficult to advise a Hong Kong taxpayer to pursue an appeal through the Hong Kong courts.
Consider this: If a taxpayer is unable to settle an objection against an assessment, the case will be referred to the Commissioner of Inland Revenue (CIR) for [...]

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CG Lighting v CIR – How Much Worse Can It Get?

October 28, 2011

Several colleagues have asked me whether and when I intend to comment on the Hon Tang’s AG CJHC judgment in the case of Commissioner of Inland Revenue v CG Lighting Limited; the unwillingness of the Inland Revenue Department (“the Department”) to consent to CG Lighting Limited’s (“CGL”) application for leave to appeal to the Court [...]

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THE GOVERNMENT CONTINUES TO REFUSE GROUP RELIEF FOR TAX LOSSES

July 5, 2011

For many years, Hong Kong’s professional bodies and Chambers of Commence have lobbied the Government to amend the Inland Revenue Ordinance to allow group loss relief. Of the many arguments advanced for the introduction of such legislation, the following have consistently found support from lobbyists:
Corporate groups in Hong Kong may:
• pay tax as a group [...]

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THE GOVERNMENT USES TAXATION FOR SOCIAL ENGINEERING

July 5, 2011

Rather naively, I used to think that the purpose of levying taxes was to enable Governments to meet their fiscal budgets, including measures to improve the standard of living for all concerned in the said country. Whilst not wanting to contribute more tax than I’m obliged to, I think it’s clear that “what the [...]

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OFFSHORE COMMISSION INCOME A WIN FOR THE TAXPAYER CIR v LI AND FUNG

July 5, 2011

The facts of the case are that Li and Fung (“L&F”) assisted its customers in connection with the manufacture, sale and purchase of goods, for which it received a commission of 6% of the total FOB value of the customer’s export sales. L&F had entered into contracts with its offshore affiliates to perform certain [...]

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The IRD Continues its Fight against Hong Kong Manufacturers

December 21, 2010

Earlier this year, at the request of the Financial Services and the Treasury Bureau, the Joint Liaison Committee on Taxation (JLCT) submitted a proposal to the Hong Kong Government to amend the Inland Revenue Ordinance (“IRO”) so as to allow Hong Kong taxpayers a profit tax deduction for plant and equipment used, free of charge, [...]

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Hong Kong/United Kingdom and Ireland Comprehensive Double Taxation Agreements – Update

July 5, 2010

Hong Kong has signed Comprehensive Double Taxation Agreements (“CDTAs”) with the United Kingdom and Ireland for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income.  So far in 2010, Hong Kong has signed eight agreements, which all adopt the 2004 OECD standard on [...]

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Hong Kong and Ireland Sign a Comprehensive Double Taxation Agreement

June 24, 2010

Hong Kong signed a Comprehensive Double Taxation Agreement (“CDTA”) with Ireland on June 22, 2010.  This is Hong Kong’s 13th CDTA.
Secretary for Financial Services & the Treasury, Professor Chan commented that “the agreement will encourage Hong Kong enterprises to leverage on the success of Irish companies in the [...]

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Hong Kong / United Kingdom Comprehensive Double Taxation Agreement

June 23, 2010

Hong Kong’s Comprehensive Double Taxation Agreement (“CDTA”) with the United Kingdom was signed on June 21, 2010.  It is Hong Kong’s 12th CDTA.
Under the CDTA, dividends paid by a company will be exempt from tax, and dividends paid by a UK Real Estate Investment Trust will be subject to [...]

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Hong Kong Issues Guidelines on the Exchange of Tax Information

June 22, 2010

On June 9, 2010, the Inland Revenue Department (“the Department”) published its Departmental Interpretation and Practice Note No 47 “Exchange of Information under Comprehensive Double Taxation Agreements”. Although, as I have previously noted, the Department does not feel bound by its own Practice Notes, they nonetheless provide genuine guidance as to the normal Departmental [...]

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