Hong Kong, Russia tax treaty signed

Hong Kong and Russia signed a new tax treaty on January 19, Hong Kong’s Inland Revenue Department has announced.

The tax treaty is Hong Kong’s 34th such agreement, said Professor K C Chan, who signed the treaty on behalf Hong Kong. The treaty “sets out clearly the allocation of taxing rights between the two jurisdictions and thus will help investors better assess their potential tax liabilities from cross-border economic activities,” Chan said.

Under the agreement, the withholding tax on dividends is reduced to 5 percent if the beneficial owner is a company which holds directly at least 15 percent of the capital of the company paying the dividends. In other cases, the withholding tax rate applied to dividends is 10 percent. The withholding tax rate for royalties under the treaty is reduced to 3 percent.

The agreement also covers taxation of property revenues and sea and air transportation earnings. It further includes provisions for exchange of tax information between tax administrations.

Russia’s State Secretary, Deputy Minister of Finance, Yuriy Zubarev, signed the agreement on behalf of Russia.

See:

• Hong Kong, Russia tax treaty

Related MNE Tax articles:

• Russian government approves tax treaty with Hong Kong