B.String Business Consulting Ltd.

Success Story Using Hong Kong Company about Taxation Lower tax rate in Hong Kong No tax in Hong Kong - Offshore operation tax exemption Trading Business Service providing business No tax – for Royalty income Investing in Europe - enjoying Double Tax Agreement (DTA) about Transaction Lower transaction fee in selling property about Trading Avoid disclosing supplier information - protecting trading business about China market Enjoying largest benefit - using Hong Kong company as stepping stone Using Hong Kong HSBC bank account Acting as finance centre for international trading group RMB bank account for China trade and business Investing in Europe - enjoying Double Tax Agreement (DTA) Background Mr. A is investing in European company, such as a French company (F Ltd); F Ltd performs well and will remit different type of payment to Mr A every year - such as dividend, interest and royalty etc. ; The arrangement Mr. A forms a Hong Kong company (H Ltd) as 100% shareholder; H Ltd is 100% shareholder of a Luxembourg company (L Ltd); L Ltd is 100% shareholder of French company - the F Ltd; Payment from F Ltd reaches Mr. A via L Ltd and H Ltd. Benefit H Ltd and L Ltd is regarded as "Twin-Company" - there is double tax agreement between HK and Luxembourg; Luxembourg company also enjoys local tax benefit in Europe; Withholding tax payable by French company If no Twin-Company structure If used Twin-Company structure Dividend 25% 0% Interest 16% 0% Royalty 33% 0% The income received by L Ltd and H Ltd is tax free - according to their respective tax rules. See also : FAQs > Hong Kong Company - Private Limited Company > Tax Filing > Double Taxation - Introduction Page Top