Hong Kong Proposes Tax Deduction Regime for Acquisition of IP Rights

The Hong Kong government introduced a legislative bill ("Bill") on Mar 23, 2018, proposing to extend the current tax deduction regime for acquiring intellectual property rights (IPR) to cover three new types: 1. a performer's economic right; 2. a protected layout-design (topography) r...

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Bibliographic Details
Published inJournal of International Taxation Vol. 29; no. 7; p. 11
Main Authors Wong, Charlotte, Finnerty, Chris, Parsch, Kazuyo, Yap, Bee-Khun, Ho, Tracy, Chan, Florence
Format Trade Publication Article
LanguageEnglish
Published Boston Thomson Reuters (Tax & Accounting) Inc 01.07.2018
Subjects
Bills
Intellectual property
International taxation
Nonrecourse debt
Nonresidents
Royalties
Royalty
Tax deductions
Withholding
China
Hong Kong China
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Summary:The Hong Kong government introduced a legislative bill ("Bill") on Mar 23, 2018, proposing to extend the current tax deduction regime for acquiring intellectual property rights (IPR) to cover three new types: 1. a performer's economic right; 2. a protected layout-design (topography) right; and 3. a protected plant variety right. However, royalties that a nonresident receives for granting the use of, or the right to use, the three additional IPRs to a Hong Kong taxpayer will be deemed taxable in Hong Kong, and withholding from the payment will be required. The Bill explicitly deems that royalties that a nonresident receives for granting the use of, or right to use, the three new IPRs to a Hong Kong taxpayer will generally be taxable in Hong Kong.
ISSN:1049-6378