Buying stocks with Hong Kong limited company while maintaining offshore status

[mikemcd]

Hi everyone,

I've recently opened an Interactive Brokers account with my Hong Kong company and I’ve started buying stocks to get some returns on the cash instead of keeping it in Airwallex getting 0%.

I bought some HK-listed stocks but now I worry if this could potentially break the offshore status? Anyone with experience in this? Should I use a broker outside Hong Kong?

Thank you!

 

[aniglo22]

Yes , check "Profits from the purchase and sale of listed shares and other listed securities".

---

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	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

 

[CyprusLawyer101]

You could have used a Cyprus company to trade instead and any trading would be exempt from taxation by default, without recourse to any such rules.
It could be the case that you re-domicile the company and keep the current arrangements or you set up a new one from scratch. Let me know if I could be of help.

 

[aniglo22]

You could have used a Cyprus company to trade instead and any trading would be exempt from taxation by default, without recourse to any such rules.
It could be the case that you re-domicile the company and keep the current arrangements or you set up a new one from scratch. Let me know if I could be of help.

Hong Kong allows only inward re-domiciliation

 

[CyprusLawyer101]

Hong Kong allows only inward re-domiciliation

thanks for this info - therefore re-domiciling out of Hong Kong is not an option.