X hits on this document

PDF document

These notes are issued for the information of taxpayers and their tax - page 60 / 68

178 views

0 shares

0 downloads

0 comments

60 / 68

Taxable income from the Mainland Tax payable in Hong Kong before allowance of tax credit Total assessable income

$ 20,000 3,500

20,000

Tax credit limit for tax paid in the Mainland

= $20,000 x

$3,500 $20,000

= $3,500

Example 9

Following Example 8, assume Company D, in addition to the royalties from the Mainland, receives royalties of $80,000 from Thailand and the tax withheld in Thailand is $8,000 (i.e. $80,000 x

10%).

Company D incurs expenses of $20,000 (excluding the tax

withheld in the Thailand) in the production of royalties from Thailand and such expenses are allowable for deduction under the Ordinance. Company D does not have other income or expenses during the relevant year.

$

Assessable income for the year of assessment 2007/08 $(90,000 + 80,000 – 70,000 – 20,000)

80,000

Tax payable before allowance of tax credit (the tax rate for the year 2007/08 is 17.5%) Less: Tax credit

14,000

- Tax paid in Thailand

$8,000

)

or

)

- The tax credit limit

$10,500 )

  • -

    Tax credit limit for tax paid in the Mainland,

see Example 8 above

(3,500)

[$(80,000 – 20,000) x 17.5%] (whichever is smaller)

Tax payable after allowance of tax credit

)

(8,000) 2,500

Since the Comprehensive Arrangement applies to years of assessment beginning on or after 1 April 2007 in Hong Kong, the tax withheld in the Mainland in respect of the royalties received by Hong Kong resident Company

56

Document info
Document views178
Page views178
Page last viewedSat Dec 10 20:52:25 UTC 2016
Pages68
Paragraphs2167
Words22491

Comments