Update on Hong Kong’s Foreign Source Income Exemption

[Marzio]

Under the updated FSIE regime, offshore in-scope passive income will be deemed to be sourced from Hong Kong and chargeable to profits tax if:

• The income is received in Hong Kong by a constituent entity of an MNE[1] group (“covered taxpayer”) irrespective of its revenue or asset size; and
• The recipient entity fails to meet the economic substance requirement for in-scope, non IP, offshore income, or fails to comply with the nexus approach for IP income.

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Who would continue to do business in HK after Xi wanting HK to become China and with those restrictions on FSI?

 

[JackAlabama]

Under the updated FSIE regime, offshore in-scope passive income will be deemed to be sourced from Hong Kong and chargeable to profits tax if:

• The income is received in Hong Kong by a constituent entity of an MNE[1] group (“covered taxpayer”) irrespective of its revenue or asset size; and
• The recipient entity fails to meet the economic substance requirement for in-scope, non IP, offshore income, or fails to comply with the nexus approach for IP income.

Apex Group - Single Source Financial Solution Provider

We are your Single Source Financial Solution Provider. Our Services Include - Corporate Services, Fund Services, ESG, Digital Corporate Banking & Manco Services

www.sannegroup.com

Who would continue to do business in HK after Xi wanting HK to become China and with those restrictions on FSI?

What is really disturbing is HK being closed off for so long and these ever tightening rules there made me exit HK for good.
If HK became China or nah never really bothered me tho and I hoped they would apply one or the other "openness" of USA regarding companies at least.

 

[Marzio]

these ever tightening rules there made me exit HK for good.

Did you go for DXB?

 

[JackAlabama]

Did you go for DXB?

Yes. And increased US exposure as well. A good working combo.

 

[backpacker]

Under the updated FSIE regime, offshore in-scope passive income will be deemed to be sourced from Hong Kong and chargeable to profits tax if:

• The income is received in Hong Kong by a constituent entity of an MNE[1] group (“covered taxpayer”) irrespective of its revenue or asset size; and
• The recipient entity fails to meet the economic substance requirement for in-scope, non IP, offshore income, or fails to comply with the nexus approach for IP income.

Apex Group - Single Source Financial Solution Provider

We are your Single Source Financial Solution Provider. Our Services Include - Corporate Services, Fund Services, ESG, Digital Corporate Banking & Manco Services

www.sannegroup.com

Who would continue to do business in HK after Xi wanting HK to become China and with those restrictions on FSI?

Sorry, but this is old news. A thread already exists over here -> Hong Kong (Passive) Foreign Source Income Exemption to end 1 Jan 2023 .

 

[Marzio]

I forgot that i even commented in that thread LOL