CN-No More Double Taxation! Discover Hong Kong’s Latest CDTAs

On October 22, 2023, the Chief Executive in Council announced five new Orders under the Inland Revenue Ordinance (Cap. 112), aimed at implementing Comprehensive Avoidance of Double Taxation Agreements (CDTAs) with Armenia, Bahrain, Bangladesh, Croatia, and Türkiye. These Orders are set to be published in the Gazette on October 25.

The introduction of these agreements is expected to significantly benefit residents of Hong Kong and the respective countries involved. According to a government spokesperson, “Under the CDTAs, residents will no longer face double taxation on a single source of income. This change will provide much-needed clarity regarding tax liabilities and can lead to substantial tax savings for those engaged in cross-border trade and investment.”

The spokesperson also noted that these agreements are designed to encourage Hong Kong enterprises to expand their operations and investments into these jurisdictions, thereby fostering international business collaborations.

The Orders will be submitted to the Legislative Council for negative vetting on October 30. Once both Hong Kong and the partner countries finalize their ratification processes, the agreements will officially come into effect.

Hong Kong signed these CDTAs with Bangladesh, Croatia, Bahrain, Armenia, and Turkey during various months from January to September of 2023. With this latest announcement, the total number of jurisdictions forming CDTAs in Hong Kong now stands at 51.

For detailed insights into the key features of these new agreements, you can refer to the official annex.

This expansion reinforces Hong Kong’s commitment to enhancing its global tax framework, facilitating smoother international business operations, and promoting economic collaboration.