Hong Kong Tax Alert: 29 January 2013
Hong Kong signs comprehensive double tax agreement with Italy
Hong Kong has signed a comprehensive avoidance of double taxation agreement (CDTA) with Italy. This alert summarizes the salient points of the provisions as applicable to Hong Kong residents
On 14 January 2013 Hong Kong signed a comprehensive avoidance of double taxation agreement (CDTA) with Italy. This brings the number of CDTAs Hong Kong has concluded with other jurisdictions to twenty-seven.
Who is covered by the CDTA
The CDTA only applies to persons who are residents of either Hong Kong or Italy. In this regard, a company that is incorporated or constituted under the laws of Hong Kong automatically qualifies as a Hong Kong resident. For a company which is not so incorporated or constituted, it would be regarded as a Hong Kong resident only if it is “normally managed or controlled” in Hong Kong, a residence test commonly adopted in other CDTAs Hong Kong has concluded.
This alert summarizes:
- Tax benefits available to Hong Kong residents under the CDTA
- Several favorable provisions which are expected to boost closer economic and trade ties between Hong Kong and Italy
- The status of Hong Kong’s current CDTA network and CDTAs currently under negotiation or pending ratification