Many Hong Kong enterprises will incur commission expenditure in the actual operation process. When commission expenditure occurs, we must pay attention to whether the object of commission expenditure is individuals or companies.

Whether it is a company or an individual, first of all, they need to sign an agreement with the other party, agree on a series of information such as the way and reason of commission payment, and issue a proforma invoice. If the commission recipient is only an individual, the commission recipient's identification number will also be required.

Generally, auditors will disclose the commission expenditure separately in the audit report, so the Hong Kong company with commission expenditure must pay attention to it, and the commission in mainland China is in accordance with5%But in Hong Kong, as long as the actual expenditure is fully withheld, there is no limit to deduction.

Therefore, Hong Kong enterprises with commission expenses should prepare relevant materials to some extent, which may be supported by relevant evidences when asked by the tax bureau in future years. In this way, the tax risks of enterprises can be avoided and the tax costs of enterprises can be reduced.

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