• Service: Tax, International Executive Services, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 10/17/2013

China - Tax residency certificates for Hong Kong companies, individuals 

October 17: China’s State Administration of Taxation, after consultation and agreement with Hong Kong’s Inland Revenue Department (IRD), issued guidance that is intended to simplify the procedures that Hong Kong tax resident companies and individuals apply with respect to tax relief provisions under the China-Hong Kong income tax treaty.

The guidance (Announcement 53) has an effective date of 1 November 2013.

The new rules will alleviate the need for a tax residency certificate to be produced by Hong Kong residents at the outset of application of the income tax treaty relief provisions---although a tax residency certification may ultimately be required. For instance, a tax residency certificate may be required if the tax authorities have any doubts regarding the applicant’s residency status.

KPMG observation

The new rules place Hong Kong companies and individuals at a comparative advantage over applicants from other jurisdictions, since these other applicants are required to produce a tax residency certificate as matter of course to comply with income tax treaty application procedures in China.

Read an October 2013 report [PDF 362 KB] prepared by the KPMG member firm in China: Simplification of tax residency certificate requirements for Hong Kong companies and individuals

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