Recently inHong Kong companyIn the audit, the client's Hong Kong company engaged in trade with a Hong Kong company. The client believed that although the transaction object was a Hong Kong company, the other party did not work in Hong Kong or employ local employees in Hong Kong, and it belonged to a Hong Kong offshore company. The client believed that the trade was offshore trade (profits did not come from Hong Kong).

Mention to client during audit, general andHong Kong companyWhen trade occurs, it is deemed to be onshore trade (with profits originating in Hong Kong). Based on the offshore claims we have done over the years, this classification criteria is accepted by the Hong Kong Inland Revenue Department. If the client insists on offshore, it can also be classified as offshore.

Offshore is the identification given by the client, but the tax bureau has not recognized it, so there will be a later offshore claim, and the client needs to provide evidence to support his offshore identification. Such andHong Kong companyIs likely to be deemed onshore by the Inland Revenue Department. If so, it will be subject to profits tax on onshore profits.

So forHong Kong companyMany customers have different understandings about the division of offshore and onshore trade. It is ok to insist on their own identification, but the success rate of defense will be affected later.

CycloseThe company is committed to providing domestic and foreign customers with corporate audit, tax declaration, registration, annual inspection, tax planning and other services in Hong Kong, Singapore, Dubai and other regions. Efficient, rigorous, intimate service has been favored by many private enterprises, listed companies and large state-owned enterprises.