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In Sheung Wan, Hong Kong, the tax law resembles the general system in place throughout all of Hong Kong. Hong Kong follows what is known as a territorial principal of taxation, meaning only income or profits earned within the territory are eligible for taxation. It's worth noting that Hong Kong has one of the lowest tax rates in the world, with the personal income tax, known as salaries tax, capped at 15%, and the corporate tax, profits tax, at 16.5%.
Navigating through tax law can be complex. Situations where you may require a tax lawyer include when you are starting a new business, if you are dealing with international business and require help understanding the territorial tax principle, if you have an estate that is large enough to be subject to estate taxes, or you are subject to a tax audit. In these instances, having professionally trained support can help ensure that you comply with regulations and do not pay more tax than you are required to.
The key aspect of tax law in Sheung Wan, and generally in Hong Kong, is that the tax is territorial. Income derived from outside Hong Kong generally is tax-free. There are three main types of direct taxes in Hong Kong: Profits Tax for companies; Salaries Tax for employees, and Property Tax for property owners. There is no capital gains tax, no sales tax, no VAT, no inheritance tax, or dividend tax in Hong Kong.
The tax year in Hong Kong runs from April 1 to March 31 of the following year.
Under the territorial tax system, only income or profits earned within Hong Kong are liable to tax. Any income earned outside of Hong Kong will be exempted from taxation.
No, Hong Kong does not have an inheritance or estate tax. Assets can be passed onto heirs without these additional charges.
The standard rate of Salaries Tax is 15%.
A chargeable asset usually refers to properties located in Hong Kong. Profits from the sale of these assets could be subjected to Profits Tax.
For further help, consider reaching out to the Inland Revenue Department, which is responsible for taxation in Hong Kong. There are also numerous professional tax advisory firms available in Sheung Wan that can provide expertise.
If you're dealing with a situation related to tax law, it is advisable to consult with a tax lawyer. They can help provide tailored advice for your circumstances, guide you through the process, and help you ensure that you are tax compliant. Look for a firm or lawyer with experience in Hong Kong's taxation system, especially with cases similar to yours.
