rocket
Orbitax subscribers can now easily follow the latest COVID-19-related tax measures being implemented worldwide. New to Orbitax? Create a free account to access your dashboard and latest tax news.
News Share

The Tax Hub

Daily Tax Newsletter

Hong Kong

Responsive image

Hong Kong Revises Guidance on Court-Free Company Amalgamations

On 16 December 2016, the Hong Kong Inland Revenue Department published revised guidance on the profits tax consequences of a court-free amalgamation. The guidance covers:

  • Amalgamation with sale of assets of the amalgamating company;
  • Amalgamation without sale of assets of the amalgamating company, which covers the tax treatment of both the amalgamating and amalgamated companies;
  • The utilization of tax losses brought forward, which depends on certain conditions, including:
    • The financial resources test;
    • The trade continuation test;
    • The post entry test; and
    • The same trade;
  • Profits tax return requirements in respect of the amalgamating companies; and
  • The rights and obligations undertaken by the amalgamated company.

The guidance also notes that if the Commissioner is satisfied that the court-free amalgamation is not carried out for the purpose of obtaining tax benefits, the anti-abuse provisions in Sections 61A or 61B of Chapter 112 of the Inland Revenue Ordinance will not be made applicable to the amalgamation, and the amalgamated company will generally be treated as far as possible as if it is the continuation of and the same person as the amalgamating company. Section 61A concerns the Commissioner's authority to counteract transactions where the sole or dominant purpose was to obtain a tax benefit, and Section 61B concerns the Commissioner's authority to disallow the setoff of losses where the sole or dominant purpose of a change in shareholding was to utilize a loss.

Click the following link for the full guidance.

Powerful Tax Tools

NEW

FX Rates

Global FX Rates including Tax Year Average FX Rates and Spot Rates for all Reporting Currencies.

NEW

Corporate Tax Rates

Corporate tax rates, surtaxes, and effective tax rates for the current year, as well as historical rates and approved future rates.

NEW

Country Analysis

Detailed tax guidance for companies doing business in over 100 countries, including summaries and snapshots of key tax facts and issues.

NEW

Cross Border Tax Calculator

Calculate total tax costs and benefits of a cross border transaction including withholding tax, participation exemption and foreign tax credit rules.

NEW

Cross Border Tax Rates

Provides Domestic, treaty and EU cross border tax rates for over 5,000 country combinations for 9 different payment streams.

NEW

OECD BEPS Project

Complete overview of the OECD BEPS Project, including daily BEPS news, country adoption of BEPS measures, and an overview of the 15 BEPS Actions.

NEW

Tax Calendar

Customizable calendar tool that tracks corporate income tax, value added tax and transfer pricing obligations by country or entity.

NEW

Tax Forms

English translations of key tax forms for over 80 countries, including tax return forms, treaty benefit forms, withholding tax forms, and more.

NEW

Worldwide Tax Treaties

Repository including thousands of tax treaties (in English), OECD, UN and US Models, relevant EU Directives, Technical Explanations, and more.

NEW

Worldwide Tax Planner

Calculates the worldwide tax cost of what-if scenarios based on legal entity structure, taxable income, and cross border transactions.

NEW

Certified Rates Report

Customizable Certified Rates Report providing updated corporate and withholding tax rates at the end of each month for over 100 countries.

NEW

Withholding Tax Minimizer

Enables quick calculation of tax costs and benefits of cross border transactions considering all possible transaction combinations and optimal routes.

NEW

VAT Rates

Provides value added tax (VAT) rates, goods and services tax (GST) rates and other indirect tax rates for over 100 countries.

NEW

NOL Calculator

Country specific calculator to determine how net operating losses can be utilized in carryback and carryforward years.

NEW

Transfer Pricing Calculator

Calculates TP ratios under various TP methods and calculates the difference between target ratios and actual ratios.

NEW

Individual Income Tax Rates

Individual tax rates for over 100 countries.

Play of the Day

Worldwide Tax Treaties

Repository including thousands of tax treaties (in English), OECD, UN and US Models, relevant EU Directives, Technical Explanations, and more.

We’re here to help

We’re here to answer any questions you have about the Orbitax products and services.

Send us a message

Who’s behind Orbitax?

We’re committed to providing high value, low cost tax research and management solutions.

Learn More