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Past Event

HKVCA Brownbag Luncheon Talk

Date: Thursday, 13 December 2018
Venue: Ernst & Young Office, 22/F, Citic Tower, 1 Tim Mei Ave, Admiralty
Time: 12:30 to 14:00

Michael Hong, director of EY China, delivered a luncheon talk on December 13, 2018 on China’s sweeping new individual income tax (IIT) law that comes into effect on January 1, 2019. Hong began by highlighting the differences between the old tax law and the new, noting in particular the introduction of a new definition of “resident” and “non-resident”, creating tax liability and raising double taxation issues for persons who spend an accumulated 183 days or more on the mainland. He also made clear that the 183-day determination is strict, and hence those who spent time in the mainland needed to keep in mind that it was irrelevant whether one’s presence was for business or personal interest – both will lead to China tax residency. Tax liability will also be on worldwide income, and not simply income created on the mainland. This gives Chinese tax authorities broad powers to demand financial information and documentation from individuals. However, it appears that the old “five-year exemption rule” will remain, so foreigners can escape tax liability on their non-China income, provided they have not lived in the mainland for more than five years.     
 
More than 70 people attended the luncheon talk, an indication of the importance of the topic to those in the venture capital and private equity industry. The HKVCA would like to extend our sincere thanks to EY, whose sponsorship made the event possible.