Tax Efficiency Profits of Other Hong Kong company – Performed outside Hong Kong

Treatment of other profits

Some examples of the tests used to determine the source of the main types of other business profits are as follows:

Profits under the Hong Kong Company
Tax liability in Hong Kong
Rental income from real property
Taxable if the property is located in Hong Kong
Profits derived by an owner from the sale of real property
Taxable if the property is located in Hong Kong
Profits from the purchase and sale of listed shares and other listed securities
Taxable if the stock exchange where the shares or securities in question are traded is located in Hong Kong
Where the purchase and sale took place over-the-counter, taxable where the contracts of purchase and sale are effected in Hong Kong
Profits accruing to a business (other than a financial institution) from the purchase and sale of unlisted shares and other unlisted securities
Taxable where the contracts of purchase and sale are effected in Hong Kong
Service fee income
Taxable if the services which give rise to the payment of the fees are performed in Hong Kong
Royalties received by a business
Taxable if the licence or right of use is acquired and granted in Hong Kong
Royalties on intellectual property received from Hong Kong by a non-resident
Taxable if the intellectual property is used in Hong Kong For royalties received or accrued on or after 25 June 2004, if the intellectual property is used outside Hong Kong, taxable if the royalty payment is deductible in ascertaining the assessable profits of the payer under profits tax
Interest accruing to a business (other than a financial institution)
Taxable if the lender provides the funds in Hong Kong to the borrower