I am currently resident in Mainland China (non-citizen) where I am employed and paying taxes (paid by employer so that is no problem here). At the same time I have a LLC in HK (100% ownership & sole director) which is making some profits and I would like to pay some part of profits to personal HK bank account. Which can be paid either as salary income or dividends. From HK IRD view point Mainland China is off-shore territories (as in -- income that arise in Mainland China is not taxable).

As far as I understand from ird.gov.hk website the dividends payment is exempt from tax, however the "territorial principle" is not clear in regards of salary for non-residents (as in i-am-not-in-HK-ever).

From above I have 2 questions:

  1. How would the salary be taxed in this situation? (such as -- is it exempt from tax? partially exempt? fully taxable?)
  2. Is there any issue of me paying myself everything in dividends with 0 salary?
  3. (extra mile) Would this income (paid to personal bank account in HK) be taxable in Mainland China?

PS: This is only in relation to Hong Kong and Mainland China, not any other places.

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Browse other questions tagged or ask your own question.