How Does Double Taxation Relief Work in Hong Kong?

Double taxation occurs when the same income is taxed by two jurisdictions. Hong Kong offers relief through:

• Tax credit: Foreign tax is credited against Hong Kong tax.
• Tax exemption: Foreign income is fully or partially exempt.
• Reduced tax rate: Lower rates on interest, dividends, and royalties.
• Relief by deduction: Domestic tax applied after deducting foreign tax.

These are often governed by Double Taxation Agreements (DTAs), which apply to Hong Kong residents and companies managed in Hong Kong.