Fifth Protocol Arrangement to Avoid Double Taxation
New Arrangement Between Hong Kong and the Mainland Effectively Enforced
Hong Kong and the Mainland have reached a new arrangement with the Fifth Protocol. This will be implemented in the Avoidance of Double Taxation Arrangement.
The arrangement was signed in July 2019. As part of the new arrangement, there will be a new researchers and teachers article in place. This article is aimed at providing tax relief to any Hong Kong and Mainland researchers and teachers eligible. The measure is also aimed at minimising the risks of the tax treaty being abused. The Arrangement needs to abide by the international benchmark for tax standards and prevention of abuse is one way of ensure compliance is met.
Upon approval of the completed procedures from both Hong Kong and the Mainland, the Fifth Protocol was effectively enforced on 6 December 2019. Starting from or after 1 April 2020, the new arrangement will be applicable to all income derived in Hong Kong during the years of assessment.