be counted separately. In such a case a permanent establishment would not be considered to exist in relation to a particular sub-project if it does not last more than 6 months. A project that does not last more than 6 months would not be regarded as a permanent establishment even if another project of the enterprise constitutes a permanent establishment.
Where, after the commencement of work, a project is suspended (but
not terminated or ended) pending, for example, the arrival of equipment and materials or because of bad weather, and the persons, equipment and facilities as well as materials involved have not been completely moved out, the duration of the project will, in such a case, be counted continuously without any
deduction for the days on which the project is suspended.
If the enterprise subcontracts part of a project to a subcontractor who
commences work earlier than the contractor, then in accordance with paragraph 39 above, the duration of the entire project would be counted from the date the subcontractor commences work up to the date on which the work is totally completed and handed over to the user. This method of counting the project period does not affect the separate and independent calculation of the duration
of continuous work by the subcontractor. enterprise of the Mainland, its subcontracted constitute a permanent establishment if it does In such a case, exemption from profits tax in
Where a subcontractor is an work in Hong Kong will not not last more than six months. Hong Kong would be granted
hand, if the exemption
subcontractor is a resident of Hong from tax in the Mainland would
Kong operating in the Mainland, likewise be granted under the
Provision of services by an enterprise
A permanent establishment also includes “the furnishing of services,
including consultancy services, by an enterprise of One Side in the Other Side, directly or through employees or other personnel engaged by the enterprise, but only if such services continue (for the same or a connected project) for a period
or periods aggregating more than 6 months within any 12-month period”. scope of consultancy services includes: